Clostridium perfringens type A strains that produce alpha-toxin cause gas gangrene, which is a life-threatening infection with fever, pain, edema, myonecrosis and gas production. Intramuscular injection of the toxin or Bacillus subtilis carrying the alpha-toxin gene causes myonecrosis and produces histopathological features of the disease. Immunization of mice with alpha-toxin or fragments of the toxin prevents gas gangrene caused by C. perfringens. The toxin possesses phospholipase C (PLC), sphingomyelinase (SMase) and biological activities causing hemolysis, lethality and dermonecrosis. These biological activities are closely related to PLC and/or SMase activities. However, there is yet some uncertainty about the biological activities induced by the PLC and SMase activities of alpha-toxin. Based on the isolation and characterization of the gene for alpha-toxin and a comparison of the toxin with enzymes of the PLC family, significant progress has been made in determining the function-structure of alpha-toxin and the mode of action of the toxin. To provide a better understanding of the role of alpha-toxin in tissue damage in gas gangrene, this article summarizes current knowledge of the characteristics and mode of action of alpha-toxin.