Neurobiology of the placebo effect dates back to 1978, when Levine discovered that its analgesic action is reversed by naloxone. Since then, various studies have been performed to estimate the impact of placebo on brain metabolism and neurotransmission in analgesia, depression or the Parkinson's disease. A number of involved brain structures have been pinpointed, these including nucleus accumbens and the anterior cingulate cortex (ACC), while the role of opioid regulation has been established as significant to the process. Currently, modern diagnostic appliances such as PET or fMRI are being used to determine the differences between placebo and drug effect on brain metabolism and, consequently, to identify factors responsible for therapeutic response and their potential correlation with a psychological impact. Environmental conditions, which may result in placebo efficacy increase of seven percent per decade during the last years, are also looked into. Although certain ethical and legal dilemmas appear considering the use of placebo, it is beyond any doubt that realising the influence of expectation and conditioning on the neurobiology of the placebo effect, as well as on the proper therapy, should enable better patient handling and treatment in the future.