Populations of neurons jointly drive behavior. Thus, understanding how population activity is coordinated is a key challenge. Novel recording techniques allow for the simultaneous recording from many cells revealing the joint activity of neuronal population during sensory, motor, and cognitive tasks. This has prompted widespread measurement of pairwise correlations. However, the magnitude, the interpretation, and the underlying neural mechanisms of such neural correlations are being vigorously debated. I will start by reviewing our current understanding of the biological mechanisms that control the correlation between the spiking activity of cortical neurons. In particular, I will discuss the potential pitfalls in simple mechanistic explanations of modulations in the coherence in network activity. In the second part of the talk I will discuss the role of correlations in neural coding. I will first examine the role of coupling between the neurons of the Vertical System (VS) in the lobula plate of the fly. These 20 non-spiking neurons code for the azimuth of the axis of rotation of the fly during flight. The electrical coupling between the cells is relatively large, and the activity of VS cells is strongly correlated. I will discuss the potential role this coupling plays in the processing of optical flow information. I will end with a comment on the impact of noise correlation in models used in psychophysics.