Radiocarbon is an extremely useful carbon cycle tracer and radiometric dating tool. Here, we review the main principles and challenges involved in the use of radiocarbon in palaeoceanography. First, we present a conceptual framework in which there are three possible uses of a radiocarbon measurement: 1) to obtain a calendar age interval, or a fossil entity’s age; 2) to obtain an estimate of a carbon reservoir’s past radiocarbon activity; or 3) to compare the relative radiocarbon activities of two contemporary carbon reservoirs. We discuss the analysis of marine fossil material, the generation of an atmospheric reference curve, and the interpretation of marine radiocarbon ‘ventilation metrics’ in relation to this reference curve. It is emphasized that marine radiocarbon integrates the influences of: changing radiocarbon production; air-sea gas exchange effects at the sea surface; transport times within the ocean interior; and the mixing of water parcels with different transit times from the sea surface, and different sea-surface sources. These controls are what make radiocarbon such a powerful palaeoceanographic tracer, though the difficulty of disentangling them is what makes marine radiocarbon dating and tracer studies so challenging. We discuss the implementation of radiocarbon in numerical models, and explore the theory linking ocean-atmosphere partitioning of radiocarbon and CO2. Finally, we review existing records of marine radiocarbon variability over the last ∼25,000 years, which highlight the influence of ocean-atmosphere carbon exchange on past atmospheric CO2 and climate, and point to emerging opportunities for resolving the global radiocarbon- and carbon budgets over the last glacial cycle.