The first step in the biological assessment of compounds synthesised by medicinal chemists usually involves testing in a range of in vitro biochemical/pharmacological assays. The primary purpose of these experiments is to generate robust estimates of drug parameters including potency, affinity, intrinsic activity or efficacy as well as providing an understanding of the mechanism of action of the compounds. This information is used by medicinal chemists to generate structure activity relationships and ultimately aids the design of new therapeutic agents. This article outlines the principles underlying the pharmacological analyses typically performed, describing the measurements made and highlighting the properties of various different classes of agonists and antagonists. Finally, the application of these principles and the associated analyses to the drug discovery process are exemplified.