Geosmin may be the most familiar volatile compound, as it lends the earthy smell to soil. The compound is a member of the largest family of natural products, the terpenoids. The broad distribution of geosmin among bacteria in both terrestrial and aquatic environments suggests that this compound has an important ecological function, for example, as a signal (attractant or repellent) or as a protective specialized metabolite against biotic and abiotic stresses. While geosmin is part of our everyday life, scientists still do not understand the exact biological function of this omnipresent natural product. This minireview summarizes the current general observations regarding geosmin in prokaryotes and introduces new insights into its biosynthesis and regulation, as well as its biological roles in terrestrial and aquatic environments.