Allergic bronchopulmonary aspergillosis (ABPA) is a condition that results from a hypersensitivity reaction to the fungus Aspergillus fumigatus. The purpose of the present review is to examine the pathogenesis of this condition and the evidence for treatments available. Allergic bronchopulmonary aspergillosis is characterized by an intense airway inflammation with eosinophils and the formation of mucus plugs. Clinically, there are periods of exacerbation and remission that may lead to proximal bronchiectasis and fibrotic lung disease. New evidence confirms the role of intense airway inflammation with eosinophils, but also suggests a role for interleukin (IL)-8/neutrophil-mediated inflammation in this process, and the potential deficiency of anti-inflammatory cytokines such as reduced IL-10. Treatment for ABPA has so far focused on corticosteroids to suppress eosinophilic airway inflammation. An expanding knowledge of the pathology of ABPA also suggests other therapies may be of potential benefit, particularly the use of azole antifungal agents. Allergic bronchopulmonary aspergillosis is itself an important complication of asthma and cystic fibrosis. A greater understanding of the condition is required to improve management and well-designed clinical trials need to be carried out to critically assess new and current treatments. In addition, the information gained from the studies of its pathogenesis has the potential to benefit our understanding of the disease processes in asthma and bronchiectasis.