Microsatellite instability, one of the phenomena implicated in gastric cancer, is mainly associated with the expansion or contraction of microsatellite sequences due to replication errors caused most frequently by mutations in the mismatch repair (MMR) and tumour suppressor genes. Tumours exhibiting microsatellite instability are proven to have truncated products resulting from frequent mutations in mononucleotide or dinucleotide runs in coding and non-coding regions of the targeted genes. Epigenetic changes like hypermethylation of the promoter region of MMR genes as well as gene silencing are also responsible for the microsatellite instability phenotypes. Assessing microsatellite instability in tumours has proved to be an efficient tool for the prognosis of various cancers including colorectal and gastric cancers. Such tumours are characterized by distinct clinicopathological profiles. Biotic agents like Epstein Barr Virus and H. pylori along with other factors like family history, diet and geographical location also play an important role in the onset of gastric carcinogenesis. Instability of mitochondrial DNA has also been investigated and claimed to be involved in the occurrence of gastric cancers in humans. Development of simplified but robust and reproducible microsatellite instability based molecular tools promises efficient prognostic assessment of gastric tumours.