The placebo response is the efficacy attributable to a treatment that is thought to have no specific pharmacologic effect on the condition being treated. Although potentially helpful in clinical practice, high and unpredictable placebo response rates present a major impediment to the success of clinical trials in inflammatory bowel disease (IBD) and irritable bowel syndrome (IBS). Diverse factors contribute to the placebo response rates observed in clinical trials. These include patient characteristics, physician factors, frequency of study visits, characteristics of the outcome measures, concomitant treatments, regression to the mean, properties of the intervention and treatment setting, timing of the primary endpoint and natural history of the condition. Measures that may minimize the placebo response in IBD clinical trials include early timing of the primary endpoint, minimizing the number of study visits, restricting the patient population to those with documented inflammation (such as elevated biomarkers of inflammation or evidence of mucosal inflammation), including patients with more severe symptoms (i.e. greater disease activity) and enrolling patients with prior failure of immune modulators or biologics. Attempts to limit the placebo response in IBS studies have proven more difficult. Factors associated with higher placebo response rates in IBS studies include longer duration of treatment, greater number of office visits, frequency of administration of study intervention and overall treatment effect of the active agent under study. In the future, improved understanding of the factors that drive the placebo response rate should lead to more efficient study design and drug development.