Chronic obstructive pulmonary disease (COPD) is a significant cause of morbidity and mortality worldwide, and its prevalence is increasing. Airway inflammation is a consistent feature of COPD and is implicated in the pathogenesis and progression of COPD, but anti-inflammatory therapy is not first-line treatment. The inflammation has many guises and phenotyping this heterogeneity has revealed different patterns. Neutrophil-associated COPD with activation of the inflammasome, T1 and T17 immunity is the most common phenotype with eosinophil-associated T2-mediated immunity in a minority and autoimmunity observed in more severe disease. Biomarkers have enabled targeted anti-inflammatory strategies and revealed that corticosteroids are most effective in those with evidence of eosinophilic inflammation, whereas, in contrast to severe asthma, response to anti-interleukin-5 biologicals in COPD has been disappointing, with smaller benefits for the same intensity of eosinophilic inflammation questioning its role in COPD. Biological therapies beyond T2-mediated inflammation have not demonstrated benefit and in some cases increased risk of infection, suggesting that neutrophilic inflammation and inflammasome activation might be largely driven by bacterial colonisation and dysbiosis. Herein we describe current and future biomarker approaches to assess inflammation in COPD and how this might reveal tractable approaches to precision medicine and unmask important host-environment interactions leading to airway inflammation.