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The Gram-negative, strictly anaerobic bacterium <i>Megasphaera elsdenii</i> was first isolated from the rumen in 1953 and is common in the mammalian gastrointestinal tract. Its ability to use either lactate or glucose as its major energy sources for growth has been well documented, although it can also ferment amino acids into ammonia and branched-chain fatty acids, which are growth factors for other bacteria. The ruminal abundance of <i>M. elsdenii</i> usually increases in animals fed grain-based diets due to its ability to use lactate (the product of rapid ruminal sugar fermentation), especially at a low ruminal pH (<5.5). <i>M. elsdenii</i> has been proposed as a potential dietary probiotic to prevent ruminal acidosis in feedlot cattle and high-producing dairy cows. However, this bacterium has also been associated with milk fat depression (MFD) in dairy cows, although proving a causative role has remained elusive. This review summarizes the unique physiology of this intriguing bacterium and its functional role in the ruminal community as well as its role in the health and productivity of the host animal. In addition to its effects in the rumen, the ability of <i>M. elsdenii</i> to produce C₂–C₇ carboxylic acids—potential precursors for industrial fuel and chemical production—is examined.