In the endoplasmic reticulum (ER), secretory and transmembrane proteins fold into their native conformation and undergo posttranslational modifications important for their activity and structure. When protein folding in the ER is inhibited, signal transduction pathways, which increase the biosynthetic capacity and decrease the biosynthetic burden of the ER to maintain the homeostasis of this organelle, are activated. These pathways are called the unfolded protein response (UPR). In this review, we briefly summarize principles of protein folding and molecular chaperone function important for a mechanistic understanding of UPR-signaling events. We then discuss mechanisms of signal transduction employed by the UPR in mammals and our current understanding of the remodeling of cellular processes by the UPR. Finally, we summarize data that demonstrate that UPR signaling feeds into decision making in other processes previously thought to be unrelated to ER function, e.g., eukaryotic starvation responses and differentiation programs.