Over the past decade there has been an increasing awareness of the role played by commensal bacteria in modulating mucosal immune responses and as a consequence there is now great interest in the therapeutic potential of probiotics and other bacteria based strategies for a range of immune disorders. Here we review current understanding of the mechanisms underlying the immunomodulatory actions of commensal and probiotic bacteria and probiotic organisms. We discuss prominent cell types involved in transducing signals from these bacteria, including epithelial cells, dendritic cells and T regulatory cells. We also draw attention to emerging data indicating interplay between the gut microbiota, enteric neurons and the immune system. There is a focus on the specific aspects of bacteria-host interactions that may influence the ability of a specific organism to confer potentially beneficial changes in immune responses. It is clear that there is still much to learn regarding the determinants of the diverse immune responses elicited by different bacterial strains by building on our current knowledge in these areas it may be possible to design clinically effective, bacteria based strategies to maintain and promote health.