When it was first isolated from extracts of HeLa cells in Josef Jiricny's laboratory, the thymine DNA glycosylase (TDG) attracted attention because of its ability to remove thymine, i.e. a normal DNA base, from G.T mispairs. This implicated a function of DNA base excision repair in the restoration of G.C base pairs following the deamination of a 5-methylcytosine. TDG turned out to be the founding member of a newly emerging family of mismatch-directed uracil-DNA glycosylases, the MUG proteins, that act on a comparably broad spectrum of base lesion including G.U as the common, most efficiently processed substrate. However, because of its apparent catalytic inefficiency, some have considered TDG a poor DNA repair enzyme without an important biological function. Others have reported 5-meC DNA glycosylase activity to be associated with TDG, thrusting the enzyme into limelight as a possible DNA demethylase. Yet others have found the glycosylase to interact with transcription factors, implicating a function in gene regulation, which appears to be critically important in developmental processes. This article reviews all these developments in view of possible biological functions of this multifaceted DNA glycosylase.