Microsatellite instability (MSI) can be found in 15–20% of all colorectal cancers (CRC) and is the key feature of a defective DNA mismatch repair (MMR) system. Currently, MSI has been established as a unique and pivotal biomarker in the diagnosis, prognosis, and treatment of CRC. MSI tumors display a strong lymphocytic activation and a shift toward a tumoral microenvironment restraining metastatic potential and ensuing in a high responsiveness to immunotherapy of MSI CRC. Indeed, neoplastic cells with an MMR defect overexpress several immune checkpoint proteins, such as programmed death-1 (PD-1) and programmed death-ligand 1(PD-L1), that can be pharmacologically targeted, allowing for the revival the cytotoxic immune response toward the tumor. This review aims to illustrate the role of MSI in the tumor biology of colorectal cancer, focusing on the immune interactions with the microenvironment and their therapeutic implications.