AbstractThe innate immune system in insects is composed of a large variety of specific and non‐specific responses that are activated in response to the presence of foreign agents. One important element in such responses is the enzyme phenoloxidase (PO). Here, we review recent progress in PO research and discuss new applications in the emerging field of ecological immunology. Phenoloxidase produces indole groups, which are subsequently polymerized to melanin. The enzymatic reactions in turn produce a set of intermediate products such as quinones, diphenols, superoxide, hydrogen peroxide, and reactive nitrogen intermediates, which are important during defense against bacterial (gram+ and −), fungal, and viral agents. Phenoloxidase requires a complex system of activation and inhibition that involves various cell types, PO zymogens, inhibitor enzymes, and signaling molecules. Finally, research in evolutionary ecology has studied the costs of PO in terms of resource use and pleiotropic relations with other key traits and functions. These studies indicate that PO is a costly trait, whose production and maintenance have fitness costs for hosts. Phenoloxidase does not seem to be an indicator of resistance but rather of host condition. Finally, we put forward some basic directions for future investigation of PO aimed at explaining its activating system, its substrates, its coordination with other immune components to fight off pathogens, and variation in PO in relation to gender, life stages, seasonality, and across different host species.