Hydrocortisone is a medication known as a corticosteroid and is a synthetic derivative of the natural corticosteroid hormone cortisol which is produced by the cortex of the adrenal glands.

The adrenal glands and cortisol are involved in the body's long-term adaptation to stress, whether that be psychological stress or physiological stress such as a serious injury or chronic illness. Cortisol and other corticosteroids help to regulate the body's energy metabolism, the function of the immune system, and numerous other physiological processes so that homeostasis ("balance") is maintained during times of stress.

One of the main uses of hydrocortisone as a drug is in cases of adrenal insufficiency such as the autoimmune disease Addison's disease in which the adrenal glands are incapable of producing enough corticosteroids.

Low dose hydrocortisone has been proposed as, and sometimes used as, a treatment for chronic fatigue syndrome (and related conditions) as studies have consistently shown that at least a significant subset of patients have lower than normal levels of cortisol. It has been suggested that this contributes to the fatigue and other symptoms of the disease. The dosages used are said to be physiological dosages as they simply aim to raise levels in the body to what is considered normal.

This is as opposed to pharmacological use of hydrocortisone in dosages way above what the body itself would normally produce. In this context hydrocortisone suppresses the immune system and is used to reduce inflammation in inflammatory conditions such as arthritis and gout by injection, and allergic skin conditions such as eczema using hydrocortisone cream.

Studies show that low dose hydrocortisone therapy produces improvements in chronic fatigue syndrome patients but that it may also suppress the body's natural production of the cortisol further still. Careful monitoring of cortisol production during therapy is therefore essential and it has fallen out of favour as a chronic fatigue syndrome treatment somewhat because of this significant drawback.