Undigested food is fermented in the colon by the microbiota and gives rise to various microbial metabolites. Short-chain fatty acids (SCFA), including acetic, propionic and butyric acid, are the principal metabolites produced. However, most of the literature focuses on butyrate and to a lesser extent on acetate; consequently, potential effects of propionic acid (PA) on physiology and pathology have long been underestimated. It has been demonstrated that PA lowers fatty acids content in liver and plasma, reduces food intake, exerts immunosuppressive actions and probably improves tissue insulin sensitivity. Thus increased production of PA by the microbiota might be considered beneficial in the context of prevention of obesity and diabetes type 2. The molecular mechanisms by which PA may exert this plethora of physiological effects are slowly being elucidated and include intestinal cyclooxygenase enzyme, the G-protein coupled receptors 41 and 43 and activation of the peroxisome proliferator-activated receptor γ, in turn inhibiting the sentinel transcription factor NF-κB and thus increasing the threshold for inflammatory responses in general. Taken together, PA emerges as a major mediator in the link between nutrition, gut microbiota and physiology.