Microtubule associated protein tau is a phosphoprotein which potentially has 80 serine/threonine and 5 tyrosine phosphorylation sites. Normal brain tau contains 2-3 moles of phosphate per mole of the protein. In Alzheimer's disease brain, tau is abnormally hyperphosphorylated to a stoichiometry of at least three-fold greater than normal tau, and in this altered state it is aggregated into paired helical filaments forming neurofibrillary tangles, a histopathological hallmark of the disease. The abnormal hyperphosphorylation of tau is also a hallmark of several other related neurodegenerative disorders, called tauopathies. The density of neurofibrillary tangles in the neocortex correlates with dementia and, hence, is a rational therapeutic target and an area of increasing research interest. Development of rational tau-based therapeutic drugs requires understanding of the role of various phosphorylation sites, protein kinases and phosphatases, and post-translational modifications that regulate the phosphorylation of this protein at various sites, as well as the molecular mechanism by which the abnormally hyperphosphorylated tau leads to neurodegeneration and dementia. In this article we briefly review the progress made in these areas of research.