Major aspects of design and operation of pneumatically agitated bioreactors are reviewed. The focus is on considerations that are relevant to industrial practice. Airlift bioreactors are emphasized. The treatment covers hydraulics, hydrodynamics, gas-liquid and solid-liquid mass transfer, heat transfer, mixing, and suspension. Newtonian and non-Newtonian systems are discussed. Applications in microbial fermentations, animal and plant cell culture, biotransformations with immobilized enzymes, and treatment of wastewater are outlined. Comparisons with more conventional bioreactor technologies are made. Design features for sterile processing in airlift systems are detailed. The evidence for superior performance of airlift bioreactors is overwhelming. Excellent productivities have been demonstrated with yeasts, bacteria, and filamentous fungi. Processes that produce highly viscous broths, including several biopolymer producing fermentations, have been proven in airlift devices. Similarly, many hybridoma cultures and plant cell suspensions have given good results. As a general rule, volumetric productivity of airlift bioreactors equals or betters that of conventional stirred tanks. Typically, this level of performance is achieved at substantially lower power input than in stirred vessels. Furthermore, the probability of mechanical failure and likelihood of loss of sterility are lower with airlift bioreactors. In wastewater treatment, too, airlift devices have far outperformed conventional systems. Airlift bioreactors accept higher BOD loadings, produce less sludge, and the degradation rate is faster; performance improves with increasing scale of operation. This review article includes 328 references.