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One innovation currently influencing physical medicine and rehabilitation is brain-computer interface (BCI) technology. BCI systems used for motor control record neural activity associated with thoughts, perceptions, and motor intent; decode brain signals into commands for output devices; and perform the user's intended action through an output device. BCI systems used for sensory augmentation transduce environmental stimuli into neural signals interpretable by the central nervous system. Both types of systems have potential for reducing disability by facilitating a user's interaction with the environment. Investigational BCI systems are being used in the rehabilitation setting both as neuroprostheses to replace lost function and as potential plasticity-enhancing therapy tools aimed at accelerating neurorecovery. Populations benefitting from motor and somatosensory BCI systems include those with spinal cord injury, motor neuron disease, limb amputation, and stroke. This article discusses the basic components of BCI for rehabilitation, including recording systems and locations, signal processing and translation algorithms, and external devices controlled through BCI commands. An overview of applications in motor and sensory restoration is provided, along with ethical questions and user perspectives regarding BCI technology.