Ultrasound contrast agents consist of bubbles in the micrometer range encapsulated by nanoshells. These medical microbubbles oscillate linearly upon insonification at low acoustic amplitudes, but demonstrate highly nonlinear, destructive behavior at relatively high acoustic amplitudes. This behavior has been associated with sonoporation, the transient formation of pores in cells. An overview of the physical mechanisms associated with this behavior is presented. Microbubbles have been observed to pulsate symmetrically and asymmetrically, translate, coalesce, fragment, crack, and jet during one single ultrasonic cycle. The temporary formation of an antibubble has also been observed. Assuming that fragmentation will occur only if the kinetic energy of a collapsing microbubble exceeds the instantaneous bubble surface energy, it is shown that the fragmentation threshold is not equal to the threshold at which cavitation occurs. These phenomena have, among others, potential applications in ultrasound-guided drug delivery.