Tetrahydrobiopterin is one of the most potent naturally occurring reducing agents and an essential cofactor required for enzymatic activity of nitric oxide synthase (NOS). The exact role of tetrahydrobiopterin in the control of NOS catalytic activity is not completely understood. Existing evidence suggests that it can act as alosteric and redox cofactors. Suboptimal concentration of tetrahydrobiopterin reduces formation of nitric oxide and favors “uncoupling” of NOS leading to NOS-mediated reduction of oxygen and formation of superoxide anions and hydrogen peroxide. Recent findings suggest that accelerated catabolism of tetrahydrobiopterin in arteries exposed to oxidative stress may contribute to pathogenesis of endothelial dysfunction present in arteries exposed to hypertension, hypercholesterolemia, diabetes, smoking, and ischemia-reperfusion. Beneficial effects of acute and chronic tetrahydrobiopterin supplementation on endothelial function have been reported in experimental animals and humans. Furthermore, it appears that beneficial effects of some antioxidants (e.g., vitamin C) on vascular function could be mediated via increased intracellular concentration of tetrahydrobiopterin. In this review, the potential role of tetrahydrobiopterin in the pathogenesis of vascular endothelial dysfunction and mechanisms underlying beneficial vascular effects of tetrahydrobiopterin will be discussed.