Capsaicin has a long history of anecdotal benefit for counteracting pain, heat and itch, and a majority of research into its clinical application has focussed on its analgesic potential. However, capsaicin elicits several distinct cellular activities in addition to analgesia. Hence its therapeutic potential is being actively explored in a wide range of acute and chronic pathologies including stroke and neurodegeneration, inflammatory disease and sepsis, gastrointestinal disorders and cancer. Capsaicin generates cellular responses via its physiological receptor, the transient receptor potential cation channel subfamily V member 1 (TRPV1). TRPV1 are polymodal receptors present in both peripheral nerves and the central nervous system. They primarily function as sensors of noxious stimuli, such as heat, acid and pro-inflammatory molecules, and may play an important role in body temperature regulation. Activation of TRPV1 by capsaicin can sensitise sensory neurones or modulate nerve sensation and function to produce analgesia. Interestingly, capsaicin can also exert paradoxical actions on inflammatory processes, cell viability and vascular tone. These cellular activities are largely mediated via agonism of TRPV1 that elicits multiple effects including receptor activation to desensitisation and dysfunction through Ca²⁺-dependent processes. Capsaicin’s ability to reduce neuron excitation and activation is thought to be the basis of its therapeutic benefit in pain perception and other forms of neuroprotection associated with TRPV1. However, capsaicin has several cellular effects that show benefit including anti-inflammation, anti-oxidation and anti-proliferation and some of these actions are independent of neurones and TRPV1. Hence, capsaicin has considerable therapeutic development potential in inflammation, neurotoxicity and tissue degeneration and may be beneficial in neuroprotection and in pathologies associated with the cardiovascular and central nervous systems.