Over the last few years remarkable efforts have been made using functional imaging studies to unravel brain processing of pain and decipher underlying neuronal mechanisms. Cerebral processing in experimental pain models, especially those provoking hyperalgesia, and its pharmacological modulation will form the first part of this review. In a second part we will address central mechanisms of clinical neuropathic pain. Up to now, there are at least six main mechanisms involved in the chronification of neuropathic pain: (i) activity increase in areas of the pain neuromatrix, (ii) recruitment of additional cortical areas beyond the classical pain neuromatrix, (iii) cortical reorganization and maladaptive neuroplasticity, (iv) alterations in neurochemistry (v) structural brain changes and (vi) disruption of the brain default mode network. In a third part of this review we discuss mechanisms of endogenous pain modulation.