Over the last 20 years, the resource-based view (RBV) has reached a pre-eminent position among theories in the field of strategy, but debate continues as to its precise nature. This paper contributes to the debate by critically reviewing the development of the RBV to date. The critical appraisal examines the development of the RBV in terms of theory, method, empirical evidence and practical insights. It is contended that the permeable and eclectic nature of the RBV stems from its being a theory about what firms are and how they function, and that its popularity is due to an absence of limiting behavioural assumptions. Finally, the authors provide their own subjective views on where they think RBV scholars should focus their efforts in the future.