In recent years, ionophores (IOP) have been approved in several countries around the word for use in lactating dairy cows with claims for improved milk production and immune response. Currently, the use of IOP in lactating dairy cattle is not allowed in the USA, although the application for approval of monensin for use in these animals has been submitted. As a result, additional data from experiments in which IOP were administered to lactating dairy cattle have become available over the last few years. The objective of this paper is to review the current data regarding the effects of these compounds on milk production, health status, and reproductive performance of lactating dairy cows. In the rumen, IOP inhibit gram positive bacteria, which subsequently alter ruminal fermentation resulting in increased amounts of energy and N from feeds in forms usable by the cow. When administered at effective doses, IOP do not affect, or slightly decrease, feed intake by lactating cows. This effect combined with the IOP-mediated alterations in rumen fermentation increases the supply of nutrients, particularly propionate. As a result, the energy balance is improved, enhancing in turn milk production, efficiency of milk production, and immune response. The magnitude of these effects, however, appears to be determined by several factors, many of which are poorly understood. Based on available data, improved energy balance and its favorable effects on health and milk production would be primary benefits of administering IOP to lactating cows. Thus, periparturient dairy cows, particularly over-conditioned cows, may benefit the most from the use of IOP. However, the development of efficient implementation strategies that maximize the economic returns will depend on a better understanding of the effects of IOP on the metabolism, performance, and health of transition and lactating dairy cattle.