Chinese ginseng (Panax ginseng) is a rare medicinal plant that has been used in China for more than 2,000 years. Ginsenosides are the active ingredients in ginseng. More than 30 different ginsenosides have been identified and purified. Their mechanisms of action and their use in treatment of various diseases have been extensively studied. The aims of this report are to review the current knowledge on the basic mechanism of action of ginsenosides, their successful use in treatment of long-term debilitating diseases such as diabetes mellitus, cardiovascular diseases, cancer, and neurological diseases, their interaction with conventional drugs, and the safety of the herbal preparation as dietary supplements. It is concluded that while the major molecular actions of many of the ginsenosides have been identified, results from clinical trials on demonstrating the efficacy of ginsenosides are still inconclusive. It is suggested that continuous studies are necessary to improve the detail composition of the ginseng extract to facilitate the study of clinical efficacy of this valuable nutraceutical.