Photodynamic therapy (PDT) uses light-activated drugs to treat diseases ranging from cancer to age-related macular degeneration and antibiotic-resistant infections. This paper reviews the current status of PDT with an emphasis on the contributions of physics, biophysics and technology, and the challenges remaining in the optimization and adoption of this treatment modality. A theme of the review is the complexity of PDT dosimetry due to the dynamic nature of the three essential components -- light, photosensitizer and oxygen. Considerable progress has been made in understanding the problem and in developing instruments to measure all three, so that optimization of individual PDT treatments is becoming a feasible target. The final section of the review introduces some new frontiers of research including low dose rate (metronomic) PDT, two-photon PDT, activatable PDT molecular beacons and nanoparticle-based PDT.