Congenital diaphragmatic hernia (CDH) is a frequent occurring cause of neonatal respiratory distress and occurs 1 in every 3,000 liveborns. Ventilatory support and pharmaceutical treatment of the co‐occurring lung hypoplasia and pulmonary hypertension are insufficient in, respectively, 20% of isolated cases and 60% of complex ones leading to early perinatal death. The exact cause of CDH remains to be identified in the majority of human CDH patients and prognostic factors predicting treatment refraction are largely unknown. Their identification is hampered by the multifactorial and heterogenic nature of this congenital anomaly. However, application of high‐resolution molecular cytogenetic techniques to patients' DNA now enables detection of chromosomal aberrations in 30% of the patients. Furthermore, recent insights in rodent embryogenesis pointed to a specific disruption of the early mesenchymal structures in the primordial diaphragm of CDH‐induced offspring. Together, these data allowed for the introduction of new hypotheses on CDH pathogenesis, although many issues remain to be resolved. In this review, we have combined these new insights and remaining questions on diaphragm pathogenesis with a concise overview of the clinical, embryological, and genetic data available. Pediatr Pulmonol. 2012; 47:534–545. © 2012 Wiley Periodicals, Inc.