Human milk oligosaccharides (HMO), unconjugated complex carbohydrates that are highly abundant in human milk but not in infant formula, have recently received much attention due to their potential benefits for the breast-fed neonate. While it is becoming evident that HMO structure determines their specific function, understanding the metabolic fate of ingested HMO is key in assessing their biological roles. Remarkably little is known about how, when and where they are metabolized. HMO have long been regarded as metabolically "inert" to the host, as significant amounts are excreted with the fe-ces. HMO reach the colon intact where their prebiotic effects promote healthy gut colonization. HMO can also function as soluble decoy receptors and block adhesion of microbial pathogens to epithelial surfaces. Local effects at the mucosal lining include differential cell responses or modulation of the innate immune system. A small percentage of HMO is believed to be absorbed intact in the small intestine and later excreted with the urine, which opens speculations on possible systemic effects, e.g. in the immune system or in the context of neuronal development. Oligosaccharides currently added to infant formula are structurally different from HMO and therefore most likely not functionally equivalent. Selected "authentic" HMO might soon become available for the supplementation of infant formula, but additional preclinical and clinical studies are required to demonstrate efficacy. This review provides an overview about the structural and functional properties of HMO with emphasis on recent findings in metabolism studies.