Preparations from rhizomes of Petasites hybridus (L.) Gaertn., B. Mey. & Scherb. (common butterbur) have a long history of use in folk medicine in treatment of several diseases as anti-inflammatory and spasmolytic drugs. Extracts from this species are of interest to researchers in the field of phytopharmacology due to their biologically active compounds, particularly two eremophilane sesquiterpenes (petasin and isopetasin), which are contained not only in rhizomes and roots, but also in leaves. Moreover, P. hybridus contains pyrrolizidine alkaloids, which showed hepatotoxic, carcinogenic and mutagenic properties. Hence, special extracts devoid of alkaloids obtained by sub- and super-critic carbon dioxide extraction were used in the preclinical, clinical studies and phytotherapy. Our review aims to provide a literature survey of pharmacological as well as clinical trials of P. hybridus, carried out in 2000–2013. Also several studies of other species used in non-European countries have been included. Besides, the botanical description of Petasites genus and phytochemical characteristic of P. hybridus and toxicological studies of pyrrolizidine alkaloids as well as chemical profile of patented commercial extracts from rhizomes, roots and leaves of this species used in European phytotherapy have been performed. In this review, attention has also been paid to the promising and potential application of special extracts of P. hybridus not only in the prevention of migraine, treatment of allergic rhinitis symptoms, asthma and hypertension, but also in prevention and slowing the progression of neurodegenerative diseases developing with the inflammatory process in the CNS as a new therapeutic strategy. In fact, there is already an evidence of promising properties of P. hybridus extracts and sesquiterpens – decrease in the prostaglandins and leukotrienes release, inhibition of COX-1 and COX-2 activity, as well as antagonism of L-type voltage-gated calcium channels. In order to explain the new mechanisms of action of P. hybridus extracts in the CNS and their future application in phytotherapy of diseases with neuroinflammatory process, further studies should be performed.