Starting from the plastic industry, today melt extrusion has found its place in the array of pharmaceutical manufacturing operations. This article reviews the process technology with regard to the set up and specific elements of the extruder as well as its application. Melt extrusion processes are currently applied in the pharmaceutical field for the manufacture of a variety of dosage forms and formulations such as granules, pellets, tablets, suppositories, implants, stents, transdermal systems and ophthalmic inserts. As a specific area the manufacture of solid dispersions, in particular, solid molecular dispersions using the melt extrusion process is reviewed. Melt extrusion is considered to be an efficient technology in this field with particular advantages over solvent processes like co-precipitation. Potential drawbacks like the influence of heat stress and shear forces on the drug active have been overcome in a number of examples with drugs of different chemical structure. Examples of suitable excipients and recent findings like self-emulsifying preparations are presented. The article concludes with a number of published examples of melt extrudates applying the principle of solid molecular dispersions. Improved bioavailability was achieved again demonstrating the value of the technology as a drug delivery tool.