Extracellular fluid in the central nervous system (CNS) is composed of cerebrospinal fluid (CSF), derived from the choroid plexus, and of interstitial fluid (ISF) in gray and white matter. Investigation of CSF plays a significant role in diagnosis and management of neurological disease and pathologies involving the CSF have important effects on the CNS itself. Hydrocephalus has many causes; clinical effects are due to a mixture of obstruction to CSF flow and damage to periventricular white matter with CSF edema, axonal loss and gliosis. Meningitis and subarachnoid hemorrhage are mainly confined to the subarachnoid space emphasising how this compartment is separated from the CNS by the pia mater and glia limitans; brain damage results from thrombosis of leptomeningeal vessels and infarction of CNS tissue. ISF from white matter appears to drain mainly to CSF, but ISF from gray matter drains along periarterial pathways in CNS and meninges, to lymph nodes in experimental animals, and probably in humans. Beta-amyloid in Alzheimer disease and prion proteins accumulate in the extracellular spaces of gray matter and in periarterial ISF drainage pathways as cerebral amyloid angiopathy, emphasising the role of periarterial drainage for the elimination of high molecular weight substances from the brain, possibly to regional lymph nodes. Lymphatic drainage of ISF drainage plays a major role in B- and T-lymphocyte mediated immune reactions in the CNS in animals. By analogy with experimental autoimmune encephalomyelitis, lymphatic drainage of brain antigens in ISF from the human CNS may play a key role in the pathogenesis of Multiple Sclerosis.