Pseudocysts complicate acute pancreatitis in less than 5% of cases and chronic pancreatitis in 20% to 40% of cases. A pseudocyst is a localized collection of pancreatic fluid surrounded by a wall of granulation tissue and collagen. It takes 4 to 6 weeks for a fluid collection to mature and become a true pseudocyst. Unlike other cystic lesions of the pancreas from which they should be differentiated, pseudocysts lack an epithelial layer. Patients with pseudocysts present with a range of symptoms and signs. Pseudocysts are imaged using transabdominal ultrasound, CT, endoscopic ultrasound (EUS), and MRI. EUS confers an advantage over other imaging modalities in that certain EUS features are suggestive of pseudocysts over other cystic lesions. The diagnostic accuracy of EUS has improved further with the use of EUS-guided fine-needle aspiration. Therapeutic options include watchful observation or intervention. In our opinion, if acute pseudocysts are uncomplicated, asymptomatic, and do not appear to be enlarging on serial imaging, it is preferable to withhold intervention because many of these cysts resolve spontaneously. However, one needs to beware of the possibility of complications such as infection in unresolved pseudocysts. Pseudocysts associated with chronic pancreatitis are less likely to resolve spontaneously and are drained by intervention more frequently. Of the three interventional options, namely endoscopic, percutaneous, and surgical drainage, endoscopic drainage should be the treatment of choice if certain criteria are met. Preinterventional endoscopic retrograde cholangiopancreatography is mandatory to define ductal anatomy. If there is communication between the pseudocyst and the pancreatic duct, a transpapillary approach is preferred. Use of EUS should increase the number of cases in which pseudocysts can be drained endoscopically. Surgery should be reserved for cases in which there is a concern about malignancy or when there is glandular disruption.