Transient outward K+ current (Ito) plays a crucial role in shaping the early phase of repolarization and setting the plateau voltage level of action potential. As a result, it extensively affects membrane current flow in the plateau window. A great body of evidence illustrates a transmural gradient of Ito within ventricular wall with much higher density in epicardial than endocardial myocytes, which is important for the physiological ventricular repolarization. In heart failure (HF), this gradient is diminished due to a greater reduction of Ito in epicardial myocytes. This attenuates the transmural gradient of early repolarization, facilitating conduction of abnormal impulses originated in the epicardium. In addition, Ito reduction prolongs action potential duration and increases intercellular Ca2+, thus affecting Ca2+ handling and the excitation–contraction coupling. Furthermore, increased intercellular Ca2+ could activate CaMKII and calcineurin whose role in cardiac hypertrophy and HF development has been well established. Based on the impact of Ito reduction on electrical activity, signal conduction, calcium handling and cardiac function, restoration of Ito is likely a potential therapeutic strategy for HF. In this review, we summarize the physiological and pathological role of cardiac Ito channel and the potential impact of Ito restoration on HF therapy with an emphasis of recent novel findings.