Dietary intake of caffeine has significantly increased in recent years, and beneficial and harmful effects of caffeine have been extensively studied. This paper reviews antioxidant and anti-inflammatory activities of caffeine as well as its protective effects on cardiovascular diseases, obesity, diabetes mellitus, cancers, and neurodegenerative and liver diseases. In addition, we summarize the side effects of long-term or excessive caffeine consumption on sleep, migraine, intraocular pressure, pregnant women, children, and adolescents. The health benefits of caffeine depend on the amount of caffeine intake and the physical condition of consumers. Moderate intake of caffeine helps to prevent and modulate several diseases. However, the long-term or over-consumption of caffeine can lead to addiction, insomnia, migraine, and other side effects. In addition, children, adolescents, pregnant women, and people who are sensitive to caffeine should be recommended to restrict/reduce their intake to avoid potential adverse effects.