Recent years have witnessed rapid developments of computer-aided drug design methods, which have reached accuracy that allows their routine practical applications in drug discovery campaigns. Protein structure-based methods are useful for the prediction of binding modes of small molecules and their relative affinity. The high-throughput docking of up to 106 small molecules followed by scoring based on implicit-solvent force field can robustly identify micromolar binders using a rigid protein target. Molecular dynamics with explicit solvent is a low-throughput technique for the characterization of flexible binding sites and accurate evaluation of binding pathways, kinetics, and thermodynamics. In this review we highlight recent advancements in applications of ligand docking tools and molecular dynamics simulations to ligand identification and optimization.