Pituitary adenylate cyclase activating polypeptide (PACAP) was first isolated from hypothalamic extracts on the basis of its ability to stimulate cAMP formation in pituitary cells. PACAP is widely distributed in the central and peripheral nervous systems and exerts numerous effects. Currently available data indicate that PACAP is a promising neuroprotective peptide. PACAP plays an important role during the development of the nervous system and in regeneration following nervous injuries. It has strong anti-apoptotic effects in several neuronal cultures and in vivo. PACAP protects neurons against various toxic insults in vitro, has anti-inflammatory actions and stimulates the release of neuroprotective substances from astrocytes. In vivo, the protective effects of PACAP have been shown in various models of brain injuries, including cerebral ischemia, Parkinsons disease, trauma and nerve transections. The upregulation of PACAP following several types of nerve injuries indicates that endogenous PACAP plays a role in the post-traumatic recovery of the nervous system. The present report reviews the current knowledge on the neurotrophic and neuroprotective effects of PACAP.