Since the discovery of the thyroid C-cell, considerable progress has been made regarding its origin, function, and pathology. In this article an attempt is made to summarize and update our knowledge about physiologic or reactive C-cell hyperplasia, neoplastic C-cell hyperplasia (medullary carcinoma in situ), and medullary microcarcinoma. Seldom recognized preoperatively, physiologic C-cell hyperplasia is associated with inflammatory, metabolic, and neoplastic thyroid disorders as well as with hypercalcemia. However, the pathogenesis is still unclear. Although physiologic C-cell hyperplasia may progress to medullary carcinoma, the full malignant potential is unknown. Problems related to the definition of physiologic C-cell hyperplasia are discussed. Immunohistochemistry and quantitative analysis are required for the diagnosis. By contrast, C-cell hyperplasia associated with MEN II syndromes or familial medullary carcinoma can be diagnosed preoperatively in asymptomatic children or adolescents by the detection of germline mutations of the RET protooncogene. Morphologic and genetic abnormalities support the idea that C-cells in the familial form of C-cell hyperplasia are neoplastic and can be recognized with conventional stains. Therefore, the number of C-cells is irrelevant for the diagnosis. Medullary microcarcinoma is a neoplasm that measures < 1 cm. The sporadic variant is usually an incidental microscopic finding, whereas the familial form can be diagnosed by genetic testing. Its morphologic features and biologic behavior differ from those of larger medullary carcinomas. The frequency of medullary microcarcinoma will probably increase with the use of genetic testing.