“Ecstasy” (MDMA) is a powerful hallucinogenic drug which has raised concern worldwide because of its high abuse liability. A plethora of studies have demonstrated that MDMA has the potential to induce neurotoxicity both in human and laboratory animals. Although research on MDMA has been carried out by many different laboratories, the mechanism underlying MDMA induced toxicity has not been fully elucidated. MDMA has the ability to reduce serotonin levels in terminals of axons in the cortex of rats and mice. Recently we have shown that it also has the potential to produce degenerate neurons in discrete areas of the brain such as insular and parietal cortex, thalamus, tenia tecta and bed nucleus of stria terminalis (BST). Acute effects of MDMA can result in a constellation of changes including arrthymias, hypertension, hyperthermia, serotonin (5-HT) syndrome, liver problems, seizures and also long lasting neurocognitive impairments including mood disturbances. In human MDMA abusers, there is evidence for reduction of serotonergic biochemical markers. Several factors may contribute to the MDMA-induced neurotoxicity, especially hyperthermia. Other factors potentially influencing MDMA toxicity include monoamine oxidase metabolism of dopamine and serotonin, nitric oxide generation, glutamate excitotoxicity, serotonin 2A receptor agonism and the formation of MDMA neurotoxic metabolites. In this review we will cover the following topics: pharmacological mechanisms, metabolic pathways and acute effects in laboratory animals, as well as in humans, with special attention on the mechanism and pathology of MDMA induced neurotoxicity.