11β-Hydroxysteroid dehydrogenase type 1 (11β-HSD1) interconverts the inactive glucocorticoid cortisone and its active form cortisol. It is widely expressed and, although bidirectional, in vivo it functions predominantly as an oxoreductase, generating active glucocorticoid. This allows glucocorticoid receptor activation to be regulated at a prereceptor level in a tissue-specific manner. In this review, we will discuss the enzymology and molecular biology of 11β-HSD1 and the molecular basis of cortisone reductase deficiencies. We will also address how altered 11β-HSD1 activity has been implicated in a number of disease states, and we will explore its role in the physiology and pathologies of different tissues. Finally, we will address the current status of selective 11β-HSD1 inhibitors that are in development and being tested in phase II trials for patients with the metabolic syndrome. Although the data are preliminary, therapeutic inhibition of 11β-HSD1 is also an exciting prospect for the treatment of a variety of other disorders such as osteoporosis, glaucoma, intracranial hypertension, and cognitive decline.