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Many countries in the world are affected by severe acute respiratory syndrome (SARS) coronavirus-2 (SARS-CoV-2) disease-2019 (COVID-19) pandemic. Approximately 80% of the cases are mild symptomatic, 15% are severe and approximately 5% are critically ill. The mortality among severe and critically ill patients ranges from 17% to 78%. Elderly and patients with comorbidities have higher chances of progression to severe disease and subsequent mortality. There are no proven antiviral agents available for the management of COVID-19. Besides the viral cytopathic effects, dysregulation in immunity also contributes substantially to the pathogenesis. Treatment with immunomodulatory agents such as interleukin-6 blockers, glucocorticoids and mesenchymal stem cell therapy has been observed to be potentially beneficial. In this review, the immune response in SARS-CoV-2, the mechanism of immune dysregulation as well as potential therapeutic targets for immunomodulatory therapies are discussed.