Advances in information and communication technology have facilitated the development of online psychotherapy. This form of psychotherapy would provide the developing world with better access to professional mental healthcare services. At the same time, it is prudent to carefully consider the various ethical, legal and regulatory issues involved in online psychotherapy. This paper highlights the major ethical issues involved in the use of online psychotherapy, whether conducted via e-mail, chat rooms or interactive video, and identifies practical solutions for the ethical dilemmas that exist. Many authors and organisations have expressed their opinions on the subject, but no consensus has evolved. The advice offered to psychologists is mostly skewed and the scarcity of literature available to those considering expanding their practice to include online psychotherapy is certainly a source of vexation. While reviewing the existing literature, this paper seeks to describe and discuss the major ethical issues in this area, particularly in India, but many of these issues will be equally applicable to any developing world settings.