Microglia are resident cells of the brain that regulate brain development, maintenance of neuronal networks, and injury repair. Microglia serve as brain macrophages but are distinct from other tissue macrophages owing to their unique homeostatic phenotype and tight regulation by the central nervous system (CNS) microenvironment. They are responsible for the elimination of microbes, dead cells, redundant synapses, protein aggregates, and other particulate and soluble antigens that may endanger the CNS. Furthermore, as the primary source of proinflammatory cytokines, microglia are pivotal mediators of neuroinflammation and can induce or modulate a broad spectrum of cellular responses. Alterations in microglia functionality are implicated in brain development and aging, as well as in neurodegeneration. Recent observations about microglia ontogeny combined with extensive gene expression profiling and novel tools to study microglia biology have allowed us to characterize the spectrum of microglial phenotypes during development, homeostasis, and disease. In this article, we review recent advances in our understanding of the biology of microglia, their contribution to homeostasis, and their involvement in neurodegeneration. Moreover, we highlight the complexity of targeting microglia for therapeutic intervention in neurodegenerative diseases.