Prostacyclin and prostacyclin analogues are potent vasodilators and possess antithrombotic, anti-inflammatory and antiproliferative properties. These properties qualify them as efficient drugs for the treatment of pulmonary hypertension, a life-threatening illness characterized by an increase in artery pressure and vascular resistance in the pulmonary circulation. Diseased pulmonary vessels show specific remodeling with intimal fibrosis, medial hypertrophy, and adventitial thickening, as well as functional changes characterized by vasoconstriction and in situ thrombosis. The intravenous administration of prostacyclin is a well-established therapy option in severe pulmonary hypertension. However, lack of pulmonary and intrapulmonary selectivity can lead to life-threatening pulmonary and systemic side effects. Therefore, the application of prostanoids by inhalation had been proposed. Several studies with inhaled iloprost, a stable prostacyclin analogue, demonstrated preferential and potent vasorelaxation in the pulmonary circulation. In a randomized, double-blind, placebo controlled, multicenter study in 203 patients with pulmonary hypertension inhaled iloprost showed significant improvement of exercise capacity and pulmonary hemodynamics with excellent tolerability and safety. Consequently, inhaled iloprost has been approved in many countries for treatment of severe pulmonary hypertension. A major drawback of inhaled iloprost, however, is the short half-life and hemodynamic effect (30 to 60 min) demanding multiple daily inhalation manoeuvres (up to nine times). Strategies for further improvement of inhaled prostanoid therapy include use of prostacyclin analogues with longer half-life (e.g., treprostinil), combinations with oral drugs (e.g., phosphodiesterase inhibitors or endothelin receptor antagonists) and development of aerosolized controlled release formulations such as liposomes and nanoparticles. The therapy with prostacyclin and its analogues is a main pillar in the treatment of pulmonary hypertension, giving new hope to many patients suffering from this terrible disease. With inhaled iloprost, a new drug has enlarged the scope of aerosol therapies for treatment of pulmonary and systemic diseases.