The utility of microlaminates in engineering applications depends ultimately on their strength and toughness. While the properties of monolithic films and coatings can be controlled through crystal structure and microstructure, the properties of microlaminates are a sensitive function of the interfaces, It is the large number of interfaces in a microlaminate that determines the unique behavior of this special type of composite. This review begins with a property-based definition of a microlaminate. The mechanisms by which microlaminates deform plastically are reviewed and evaluated in the context of data on metal-metal, metal-intermetallic, metal-ceramic and ceramic-ceramic systems. It is evident that in addition to layer geometry, the layer microstructure plays a major role in determining the operative deformation mechanism. The fracture processes in a microlaminate are examined in the context of the layer strength, microstructure, defects and crack-tip-dislocation processes. High toughnesses in microlaminate materials can be attained through a combination of mechanisms, and their effectiveness depends critically on the ability to affect the magnitude and shape of the stress field at the tip of the crack. The study of deformation and fracture in microlaminates is still a relatively young field in materials science. However, while our understanding of these processes is still quite incomplete, it is improving rapidly with advances in experiment, theory and modeling capability.