Merkel cell carcinoma (MCC) is an aggressive skin cancer that is causally associated with ultraviolet light exposure and a recently discovered polyomavirus. Before 2010, MCC was staged using any of 5 unique systems in active use. In 2010, a consensus staging system for MCC was adopted worldwide and replaced these systems. This consensus system includes substages that reflect prognostic differences based on whether nodal evaluation was performed by pathologic analysis or clinical assessment alone. MCC-specific disease classification in ICD-9, to be expanded in the upcoming ICD-10, has improved the ability to track and manage this malignancy. Several biomarkers and histopathologic features have been identified that improve understanding of this cancer and may lead to future refinement of the current staging system. In 2008, the Merkel cell polyomavirus was discovered and is now thought to be a critical mechanism of transformation in at least 80% of MCCs. In patients who produce antibodies to the viral T-antigen oncoprotein, the titer increases and decreases with MCC disease burden and can be a clinically useful marker of recurrence. Diverse studies link CD8-positive T-cell function with outcomes in MCC and serve as the rational basis for ongoing trials of therapies to augment cellular immunity. This article reviews basic and translational research insights that will lead to improved staging, prognostic accuracy, and mechanism-based therapy for this often-lethal skin cancer.