This paper revises the response of freshwater ostracods to different environmental conditions and anthropogenic impacts, with a worldwide overview of the potential use of these microcrustaceans as bioindicators and several examples of applications in different scenarios. The development of either a single species or an ostracod assemblage is influenced by physical–chemical properties of waters (salinity, temperature, pH, dissolved oxygen), hydraulic conditions, bottom grain sizes or sedimentation rates. In addition to population and community changes, morphological and geochemical changes can also be detected in the ostracod carapace, which serves as a tracer of the water quality. All these features permit to delimit the spatial effects of urban sewages, mining effluents, agricultural wastes, watershed deforestation or road building. These data are the basis for the palaeoenvironmental reconstruction of cores, with an interesting application to archaeology. In addition, favourable results of recently developed bioassays, coupled with an important variability of local assemblages under changing conditions in both waters and sediments, suggest that these microcrustaceans may included between the most promising sentinels groups in freshwater areas. These microcrustaceans show high sensitivity to pesticides, herbicides, heavy metal pollution and oil inputs.