Capsaicin (8-methyl-N-vanillyl-6-nonenamide) is a primary pungent and irritating principle present in chilies and red peppers which are widely used as spices. Because of its selective effects on the functions of a defined subpopulation of sensory neurons, capsaicin is currently used as a versatile tool for the study of pain mechanisms and also for pharmacotherapy to treat several pain disorders. Considering the frequent consumption of capsaicin as a food additive and its current medicinal use, correct assessment of hazardous effects of this compound is important. Mutagenic and carcinogenic activities of capsaicin and chili extracts have been studied, but results are conflicting. Mammalian metabolism of capsaicin has been also reported. Capsaicin appears to interact with xenobiotic metabolizing enzymes, particularly microsomal cytochrome P450-dependent monooxygenases which are involved in activation as well as detoxification of various chemical carcinogens and mutagens. Recent studies have shown that hepatic cytochrome P450 2E1 catalyzes the conversion of capsaicin to reactive species such as the phenoxy radical intermediate capable of covalently binding to the active site of the enzyme as well as tissue macromolecules. While covalent modification of protein and nucleic acids leads to toxicity including necrosis, mutagenesis, and carcinogenesis, suicidal inhibition of microsomal cytochrome P450 may prohibit further activation of capsaicin and also of other toxic xenobiotics. Results from recent studies indicate that capsaicin possesses the chemoprotective activity against some chemical carcinogens and mutagens.