Many tryptophan and indole derivatives, among them halogenated compounds, possess high biological activity and function as neurotransmitters, antibiotics, anti-carcinogenic compounds, protein kinase inhibitors, anti-inflammatory drugs and plant growth regulators. In this review we will discuss a class of indole derivatives which are halogenated in different positions of the indole ring. Such compounds have been known for many years now for their high biological activity. Heterotrophic microorganisms are able to catalyze the halogenation using a range of different enzymes, however, there is only very little information about halogenation in plants. From bacteria gene clusters for the biosynthesis of biologically active halogenated metabolites have been isolated, which contain gene(s) for halogenases. These halogenases are regiospecific and may therefore be important tools for combinatory biosynthesis of pharmacologically interesting substances. However, not all positions on the indole ring that are known to be halogenated in nature are found in bacteria. Metabolic studies have shown that some plants also contain halogenated indole derivatives with halogenation patterns different from that of bacteria. Not much is known about the role of these compounds in plants and how they are synthesized. In this review we will summarize the current knowledge on halogenated natural compounds containing the indole ring system, as well as compare the spectrum in heterotrophic and photoautotrophic bacteria and plants. We will also discuss the biosynthesis of these halogenated indole derivatives and their potential biotechnological value.