Modulation spectroscopy is a powerful method for the study and characterization of a large number of semiconductor configurations, including bulk/thin film, microstructures (heterojunctions, quantum wells, superlattices, quantum dots), surfaces/interfaces and actual device structures in addition to semiconductor growth/processing. Furthermore, the influence of external perturbations such as temperature, electric fields, hydrostatic pressure, uniaxial stress, etc. can be investigated. This optical technique utilizes a very general principle of experimental physics, in which a periodically applied perturbation (either to the sample or probe) leads to sharp, derivative-like spectral features in the optical response of the system. Because of the richness of the derivative-like spectra, the information in the lineshape fits, room temperature performance and relative simplicity of operation this method is becoming increasingly more important as a tool to study these materials and structures. This article will review developments in the field during the last decade.