There has been an alarming increase in the incidence of autoimmune and allergic diseases in Western countries in the past few decades. However, in countries endemic for parasitic helminth infections, such diseases remain relatively rare. Hence, it has been hypothesised that helminths may protect against the development of autoimmunity and allergy. This article reviews the evidence supporting this idea with respect to helminths of the phylum Nematoda (nematodes), considering data from human studies and animal models of inflammatory disease. The nature and mode of action of nematode-derived molecules with immunomodulatory properties are considered, and their therapeutic efficacy in models of autoimmunity and allergy described. The recent and future use of nematodes and their products in treating human disease are also discussed.