The odontogenic keratocyst (OKC, currently designated by the World Health Organization as a keratocystic odontogenic tumor) is a locally aggressive, cystic jaw lesion with a putative high growth potential and a propensity for recurrence. Although it is generally agreed that some features of OKCs are those of a neoplasia, notably the relatively high proliferative rate of epithelial cells, controversies over the behavior and management of OKCs still exist. This article is intended to review this intriguing entity and to summarize the findings of recent studies related to the nature of OKCs and their clinical and therapeutic implications. Recent advances in genetic and molecular research, i.e., PTCH1 mutations and involvement of the Hedgehog signaling pathway, have led to increased knowledge of OKC pathogenesis which hints at potential new treatment options, although the question of whether the OKC is a cyst or a cystic neoplasm is yet to be answered with certainty. Since some advocate a more conservative treatment for OKCs, notably marsupialization and decompression, future treatment strategies may focus on molecular approaches and eventually reduce or eliminate the need for aggressive surgeries.