The effects of electrical stimulation on the nervous system have been known for many years. Electrical stimulation has been employed as a treatment of functional diseases of the nervous system and has been mainly developed on the basis of deep brain stimulation (DES), motor cortex stimulation (MCS), and spinal cord stimulation (SCS). Over the past two decades, DBS has replaced lesioning techniques as a treatment for movement disorders, and DBS has been shown to be safe and efficacious. The field of application for DES is becoming wider, currently encompassing dystonias, epilepsy, and psychiatric disease. On the other hand, MCS has been employed as a therapy for intractable pain for more than ten years. Recently, this therapy has been used as a treatment for involuntary movements and motor palsy caused by stroke. Although the effects of electrical stimulation are distinct and the therapeutic benefits are well recognized, the exact mechanisms of these therapies have not yet been fully clarified. Animal experiments, either in vitro or in vivo, show complex patterns roughly suggesting inhibitory effects. More recent data from in vitro biological research studies show that electrical stimulation affects cellular functions, particularly protein synthesis, suggesting that it could alter synaptic transmission and reorganize neural networks. Research for the understanding of the effects of electrical stimulation at the neuronal level is still in progress, and knowledge from these research will eventually improve the effectiveness of this therapy. Moreover, these basic research and preliminary clinical studies will call for the re-examination of the basic effects of electricity on living tissues because it is now clear that electrical stimulation has a wider application. In this review, we summarizes the history and rationale behind electrical neurostimulation therapy and the recent applications of this technique for various functional diseases of the nervous system.