When taken together, three conceptual paradigms have led to major advances in understanding the clinical manifestations of protein misfolding and recently have led to novel therapeutic strategies. First, disorders caused by misfolded proteins are now classified according to the mechanism by which they cause clinical effects, either loss-of-function or toxic gain-of-function. Loss-of-function is the result of mutations that specifically alter folding such that the function of the protein is impaired or such that the protein does not reach the cellular destination where its function is required or both. Cystic fibrosis is the prototype disease caused by a loss-of-function mechanism in that all of the disease manifestations arise from lack of chloride transport. The CFTRΔF508 variant does not reach the apical surface of epithelial cells predominantly because of misfolding in the endoplasmic reticulum (ER) and rapid degradation by the proteasome. The small amount of CFTR ΔF508 that does reach the cell surface is unstable and this probably also contributes to loss of chloride transport activity at epithelia. Toxic gain-of-function mechanisms are attributable to the pathologic activity of the mutant protein itself or to the effect of its mislocalization or both. This type of mechanism is implicated when the mutant protein produces a toxic effect in a cell line or live animal model. Huntington’s disease and early-onset forms of Alzheimer’s disease are prototypes of the gain-of-function mechanism as protein misfolding leads to degeneration of neurons. Diseases with childhood onset also fit into the paradigm, including conditions as diverse as respiratory failure in the newborn (1) and early-onset diabetes (2), among many others. A second paradigm has come from the recognition that cells possess multiple mechanisms by which they can respond to the consequences of protein misfolding, whether involving proteotoxicity and/or protein mislocalization. These mechanisms are now referred to as the proteostasis regulatory network (3). The proteostasis network is constituted by systems that are designed to counteract proteotoxicity including chaperones to prevent mis-folding and disposal pathways, such as the ubiquitin-dependent proteasomal pathway and the autophagic response, to degrade mis-folded intermediates. The proteostasis machinery also includes signaling pathways such as the unfolded protein response and the heat shock response that alter the cellular transcriptome to counteract proteotoxicty by a broad series of mechanisms at multiple intracellular sites. Third, we have come to realize that disease caused by misfolded proteins reflects the net effect of the alteration in the protein together with the response of the cellular proteostasis network. For example, in gain-of-function diseases clinical manifestations occur only when proteotoxic effects overwhelm the proteostasis network. This means that polymorphic variants in the proteostasis network may constitute genetic modifiers of the disease phenotype. Moreover, it means that drugs which enhance endogenous proteostasis mechanisms could theoretically prevent or delay the progression of clinical disease that is caused by proteotoxicity. We will use α1-antitrypsin deficiency (ATD) as a prototype of diseases caused by misfolded proteins and review recent findings about its pathobiology and the development of novel pharmacological strategies. The classical form of this deficiency is a relatively unique member of the protein misfolding diseases in that it causes disease in one target organ, chronic obstructive pulmonary disease (COPD), by loss-of-function and causes diseases in another target organ, hepatic fibrosis and carcinoma, by gain-of-function mechanism(s).