Capsaicin is a natural protoalkaloid recognized as the main pungent component in hot peppers ( L.). The capsaicin receptor is highly expressed in the unmyelinated type C nerve fibers originating from small diameter sensory neurons in dorsal root ganglia and cranial nerve ganglia correspondents. Capsaicin and related vanilloids have a variety of effects on primary sensory neurons function, from sensory neuron excitation characterized by local burning sensation and neurogenic inflammation, followed by conduction blockage accompanied by reversible ultrastructural changes of peripheral nociceptive endings (desensitization), going as far as irreversible degenerative changes (neurotoxicity). The main role in capsaicin-induced neurogenic inflammation relies on the capsaicin sensitive, small diameter primary sensory neurons, therefore its evaluation could be used as a diagnostic instrument in functional alterations of cutaneous sensory nerve fibers. Moreover, capsaicin-induced desensitization and neurotoxicity explain the analgesic/anti-nociceptive and anti-inflammatory effects of topical capsaicin and its potential use in the management of painful and inflammatory conditions. In this study, we describe the effects of capsaicin on neurogenic inflammation and nociception, as well as its potential diagnostic value and therapeutic impact in various conditions involving impairment of sensory nerve fibers.