Over the last couple of years Diffuse Ionized Gas (DIG) has been identified as an important constituent of the interstellar medium (ISM) in the halos of spiral galaxies. Imaging in and spectroscopy of optical emission lines allow us to study the distribution and excitation of this gas with a spatial resolution not achievable for other phases of the ISM in external galaxies. Its origin and ionization is under debate and give important constraints for models of the ISM in general and on the large scale exchange of matter between disk and halo in particular. This review summarizes more recent observational results and compares them with model predictions. The data available now demonstrate that the presence of DIG in the disk-halo interface of spiral galaxies is related to star formation processes in the underlying disk. While photoionization by OB stars in the disk seems a viable source for the power required to ionize the DIG, additional processes are needed to explain some of the spectral features. The observed correlation with properties of the non-thermal radio continuum indicate that magnetic fields and cosmic rays could play a role for the physics of this medium.