Capsule endoscopy represents a significant advance in the investigation of small bowel diseases and the beginning of wireless endoscopic imaging. Capsule endoscopy involves swallowing a video capsule endoscope, which is painless and relatively safe. Its use has been established for suspected small bowel bleeding, and the role of capsule endoscopy in the investigation of inflammatory bowel disease, iatrogenic disease, polyposis syndromes and coeliac disease is evolving. It is likely that in many instances it will become the next test after standard endoscopic evaluation. Early data suggest that capsule endoscopy improves outcome in patients with suspected small bowel bleeding, but more data are required on outcomes for the other indications.