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Unstable shoulder is a common problem encountered most frequently in sportsmen. Modern treatment of this disorder requires solid knowledge of abnormal mechanics and pathology of unstable shoulder, which are dealt with in this paper. The diagnosis is based on clinical tests and noninvasive imaging techniques, the most widely used being ultrasound and the most useful magnetic resonance imaging. Arthroscopy is an important tool for diagnosing and treating broad spectrum of pathologies that may either result from or cause shoulder joint instability. The author gives a detailed overview of shoulder joint abnormalities that are amenable to arthroscopic identification, but had been mostly unknown before the introduction of arthroscopy. The chief goal of conservative treatment is to strengthen dynamic stabilizer muscles of the shoulder joint, while surgical management is mostly directed towards the restoration of static stabilizers of the glenohumeral joint. Surgery is indicated in patients with severely affected static stabilizers, in whom dynamic stabilizer muscles cannot compensate for joint instability, and in subjects who have failed conservative therapy. In such cases, the therapy is selective restoration of normal joint anatomy resulting in stability and normal function of the shoulder joint.