This article reviews the definition, incidence, pathological characteristics and natural history of low risk localised prostate cancer. Low risk disease is typically defined as clinical stage T1/T2a, biopsy Gleason score </=6, PSA < 10. This risk classification has provided a useful system for reporting of outcomes and for the production of clinical guidelines. However, the low-risk disease is a broad category with a range of pathological characteristics and clinical behaviour. Many, but not all, low-risk prostate cancers are clinically insignificant, destined never to cause any harm. The challenge of managing low risk localized prostate cancer is to distinguish patients with clinically relevant cancers, who may benefit from radical treatment, from the remainder who do not need any intervention. The natural history of untreated low-risk localised prostate cancer has not been well studied, partly because it is a relatively recent entity, and partly because it has been standard practice for men with low risk disease to receive treatment. Data from watchful waiting in the pre-PSA era, modelling studies to take account of the lead time and overdiagnosis associated with PSA testing, and the early results of active surveillance can all provide insights into the likely natural history of low risk disease. There remains a major unmet need for markers of individual prostate cancer behaviour within the low-risk category. Such markers could be used to distinguish those men with truly indolent disease, suitable for observation, from those with significant prostate cancer that stand to benefit from treatment.