Neuromyelitis optica (NMO, Devic's syndrome), long considered a clinical variant of multiple sclerosis, is now regarded as a distinct disease entity. Major progress has been made in the diagnosis and treatment of NMO since aquaporin-4 antibodies (AQP4-Ab; also termed NMO-IgG) were first described in 2004. In this review, the Neuromyelitis Optica Study Group (NEMOS) summarizes recently obtained knowledge on NMO and highlights new developments in its diagnosis and treatment, based on current guidelines, the published literature and expert discussion at regular NEMOS meetings. Testing of AQP4-Ab is essential and is the most important test in the diagnostic work-up of suspected NMO, and helps to distinguish NMO from other autoimmune diseases. Furthermore, AQP4-Ab testing has expanded our knowledge of the clinical presentation of NMO spectrum disorders (NMOSD). In addition, imaging techniques, particularly magnetic resonance imaging of the brain and spinal cord, are obligatory in the diagnostic workup. It is important to note that brain lesions in NMO and NMOSD are not uncommon, do not rule out the diagnosis, and show characteristic patterns. Other imaging modalities such as optical coherence tomography are proposed as useful tools in the assessment of retinal damage. Therapy of NMO should be initiated early. Azathioprine and rituximab are suggested as first-line treatments, the latter being increasingly regarded as an established therapy with long-term efficacy and an acceptable safety profile in NMO patients. Other immunosuppressive drugs, such as methotrexate, mycophenolate mofetil and mitoxantrone, are recommended as second-line treatments. Promising new therapies are emerging in the form of anti-IL6 receptor, anti-complement or anti-AQP4-Ab biologicals.