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Studies on the interaction of plasma generated at atmospheric pressure and at room temperature (low temperature plasma or just cold plasma) with biological cells and tissues have revealed that cold plasma has therapeutic effects that form the basis for new medical therapies. Cold plasma exhibits bactericidal properties and at low doses can modulate cell functions, including proliferation, attachment, and migration. Research in the last two decades has shown that cold plasma can be used for wound healing and can kill cancer cells in a selective manner. This paper describes the fundamental science behind the biomedical applications of cold plasma.