A plethora of biomarkers are becoming available in the field of respiratory medicine, but their application in clinical practice has been limited. This is changing. There is increasing scope for biomarkers to be used to define pathological as well as treatment responder phenotypes in asthma and chronic obstructive pulmonary disease. In some situations, conventional diagnostic labelling is being superseded by this approach and clinical outcomes are improved. Biomarkers are potentially very important in the development and assessment of new therapeutic agents, particularly for the treatment of severe asthma. They also have a potential role in monitoring disease activity and predicting future clinical outcomes for asthma and chronic obstructive pulmonary disease. Current evidence in relation to these issues is explored in this review.