Rheumatoid nodules (RNs) are the most common extra-articular manifestation of rheumatoid arthritis and are also seen in patients with other autoimmune and inflammatory diseases. The development of RNs includes histopathological stages of acute unspecified inflammation, granulomatous inflammation with no or minimal necrosis, necrobiotic granulomas typically with central fibrinoid necrosis surrounded by palisading epithelioid macrophages and other cells, and likely an advanced stage of "ghost" lesions containing cystic or calcifying/calcified areas. In this article, we review RN pathogenesis, histopathological features in different stages, diagnostically related clinical manifestations, as well as diagnosis and differential diagnosis of RNs with an in-depth discussion about challenges in distinguishing RNs from their mimics. While the pathogenesis of RN formation remains elusive, it is hypothesized that some RNs with dystrophic calcification may be in transition and may be in coexistence or collision with another lesion in patients with RA or other soft tissue diseases and comorbidities. The diagnosis of typical or mature RNs in usual locations can be readily made by clinical findings often with classic RN histopathology, but in many cases, particularly with atypical or immature RNs and/or unusual locations, the clinical and histopathological diagnosis can be challenging requiring extensive examination of the lesional tissue with histological and immunohistochemical markers to identify unusual RNs in the clinical context or other lesions that may be coexisting with classic RNs. Proper diagnosis of RNs is critical for appropriate treatment of patients with RA or other autoimmune and inflammatory diseases.