Lactoferrin (Lf) is a conserved cationic non-heme glycoprotein that is part of the innate immune defense system of mammals. Lf is present in colostrum, milk and mucosal sites, and it is also produced by polymorphonuclear neutrophils and secreted at infection sites. Lf and Lf N-terminus peptide-derivatives named lactoferricins (Lfcins) are molecules with microbiostatic and microbicidal action in a wide array of pathogens. In addition, they display regulatory properties on components of nonspecific immunity, including toll-like receptors, proand anti-inflammatory cytokines, and reactive oxygen species. Mechanisms explaining the ability of Lf and Lfcins to display both up- and down-modulatory properties on cells are not fully understood but result, in part, from their interactions with membrane receptors that elicit biochemical signal pathways, whereas other receptors enable the nuclear translocation of these molecules for the modulation of target genes. The dual role of Lf and Lfcins as antimicrobials and immunomodulators is of biotechnological and pharmaceutical interest. Native Lf and its peptide-derivatives from human and bovine sources, the recombinant versions of the human protein, and their synthetic peptides have potential application as adjunctive agents in therapies to combat infections caused by multi-resistant bacteria and those caused by fungi, protozoa and viruses, as well as in the prevention and reduction of several types of cancer and response to LPS-shock, among other effects. In this review, we summarize the immunomodulatory properties of the unique multifunctional protein Lf and its N-terminus peptides.