Cyclic-di-GMP is a ubiquitous second messenger in bacteria. The recent discovery that c-di-GMP antagonistically controls motility and virulence of single, planktonic cells on one hand and cell adhesion and persistence of multicellular communities on the other has spurred interest in this regulatory compound. Cellular levels of c-di-GMP are controlled through the opposing activities of diguanylate cyclases and phosphodiesterases, which represent two large families of output domains found in bacterial one- and two-component systems. This review concentrates on structural and functional aspects of diguanylate cyclases and phosphodiesterases, and on their role in transmitting environmental stimuli into a range of different cellular functions. In addition, we examine several well-established model systems for c-di-GMP signaling, including Pseudomonas, Vibrio, Caulobacter, and Salmonella.