The present paper reviews aspects related to the biocompatibility of NiTi shape memory alloys used for medical applications. These smart metallic materials, which are characterised by outstanding mechanical properties, have been gaining increasing importance over the last two decades in many minimal invasive surgery and diagnostic applications, as well as for other uses, such as in orthodontic appliances. Due to the presence of high amounts of Ni, the cytotoxicity of such alloys is under scrutiny. In this review paper we analyse work published on the biocompatibility of NiTi alloys, considering aspects related to: (1) corrosion properties and the different methods used to test them, as well as specimen surface states; (2) biocompatibility tests in vitro and in vivo; (3) the release of Ni ions. It is shown that NiTi shape memory alloys are generally characterised by good corrosion properties, in most cases superior to those of conventional stainless steel or Co-Cr-Mo-based biomedical materials. The majority of biocompatibility studies suggest that these alloys have low cytotoxicity (both in vitro and in vivo) as well as low genotoxicity. The release of Ni ions depends on the surface state and the surface chemistry. Smooth surfaces with well-controlled structures and chemistries of the outermost protective TiO2 layer lead to negligible release of Ni ions, with concentrations below the normal human daily intake.