Coevolution of humans and malaria parasites has generated an intricate balance between the immune system of the host and virulence factors of the parasite, equilibrating maximal parasite transmission with limited host damage. Focusing on the blood stage of the disease, we discuss how the balance between anti-parasite immunity versus immunomodulatory and evasion mechanisms of the parasite may result in parasite clearance or chronic infection without major symptoms, whereas imbalances characterized by excessive parasite growth, exaggerated immune reactions or a combination of both cause severe pathology and death, which is detrimental for both parasite and host. A thorough understanding of the immunological balance of malaria and its relation to other physiological balances in the body is of crucial importance for developing effective interventions to reduce malaria-related morbidity and to diminish fatal outcomes due to severe complications. Therefore, we discuss in this review the detailed mechanisms of anti-malarial immunity, parasite virulence factors including immune evasion mechanisms and pathogenesis. Furthermore, we propose a comprehensive classification of malaria complications according to the different types of imbalances.