The diversity of ways in which host manipulation by parasites interferes with ecological and evolutionary processes governing biotic interactions has been recently documented, and indicates that manipulative parasites are full participants in the functioning of ecosystems. Phenotypic alterations in parasitised hosts modify host population ecology, apparent competition processes, food web structure and energy and nutrient flow between habitats, as well as favouring habitat creation. As is usually the case in ecology, these phenomena can be greatly amplified by a series of secondary consequences (cascade effects). Here we review the ecological relevance of manipulative parasites in ecosystems and propose directions for further research.