Obesity is a heterogenous condition with multiple different phenotypes. Among these a particular subtype exists named as metabolically healthy obesity (MHO). MHO has multiple definitions and its prevalence varies according to study. The potential mechanisms underlying the pathophysiology of MHO include the different types of adipose tissue and their distribution, the role of hormones, inflammation, diet, the intestinal microbiota and genetic factors. In contrast to the negative metabolic profile associated with metabolically unhealthy obesity (MUO), MHO has relatively favorable metabolic characteristics. Nevertheless, MHO is still associated with many important chronic diseases including cardiovascular disease, hypertension, type 2 diabetes, chronic kidney disease as well as certain types of cancer and has the risk of progression into the unhealthy phenotype. Therefore, it should not be considered as a benign condition. The major therapeutic alternatives include dietary modifications, exercise, bariatric surgery and certain medications including glucagon-like peptide-1 (GLP-1) analogs, sodium-glucose cotransporter-2 (SGLT-2) inhibitors and tirzepatide. In this review, we discuss the significance of MHO while comparing this phenotype with MUO.