Dysplastic nevus is still a controversial entity both clinically and histologically. The occurrence of dysplastic nevus especially in the context of dysplastic nevus cell syndrome is associated with an increased risk for melanoma. The following minimal histological criteria should be fulfilled: nests of melanocytes varying in size and shape, bridging and confluent, proliferation of single melanocytes basal and suprabasal, cytoplasmic and nuclear atypia of melanocytes and subepidermal fibroplasia. The biological behavior (common nevus variant or precursor of melanoma?) is difficult to evaluate by presently available methods. The further development of new molecular biology techniques may allow a better prognosis of dysplastic nevi in an objective and reproducible manner. Against this background complete excision followed by clinical surveillance has to be recommended for the routine practice.