Capsule endoscopy of the gastrointestinal tract is an innovative technology that serves to replace conventional endoscopy. Wireless capsule endoscopy, which is mainly used for small bowel examination, has recently been used to examine the entire gastrointestinal tract. This method is promising for its usefulness and development potential and enhances convenience by reducing the side effects and discomfort that may occur during conventional endoscopy. However, capsule endoscopy has fundamental limitations, including passive movement via bowel peristalsis and space restriction. This article reviews the current scientific aspects of capsule endoscopy and discusses the pitfalls and approaches to overcome its limitations. This review includes the latest research results on the role and potential of capsule endoscopy as a non-invasive diagnostic and therapeutic device.