Nanoparticulate materials and, among them, carbon nanotubes (CNTs) are new types of material that are generating high expectations owing to their unique physical, chemical and optical properties. Owing to the predictably increasing production of various types of CNTs and other nanoparticle-containing products, it is expected that environmental and public exposure to engineered nanoparticles will also increase in parallel. If and how far CNTs are able to affect health is, at present, discussed controversially. In this article, we summarize how CNTs are produced and processed to identify critical parameters, which have to be included in the toxicological assessment. A special effort is made to address the adverse effects of CNTs on cell physiology. Furthermore, we report on CNTs in medical applications and we discuss two selected examples of prospective applications of CNTs in nanomedicine, which have realistic chances of achieving ready-to-market products in just a few years.