Amphotericin B (AmB) is a well known antifungal and antiprotozoal antibiotic used in the clinic for several decades. Clinical applications of AmB, however, are limited by its nephrotoxicity and many other acute side effects which are not acceptable by patients when their life is not threaten. In order to improve the therapeutic index of this drug, lipid formulations have been introduced and many efforts have been made to obtain less toxic AmB derivatives by chemical modifications of the parent drug. This review presents concise knowledge about this fascinating compound and a critical review of the data published within last few years about the mechanism of action of this antibiotic. In particular, in the present work we discuss: i) structure and properties of AmB and its recently synthesized new derivatives; ii) antifungal and antileishmanial activity and toxicity of these compounds; and iii) mode of action of AmB and its derivatives at cellular and molecular levels, with particular attention paid to interactions of AmB and different components of cellular membranes.