It has been estimated that over a billion dollars in resources can be consumed to obtain clinical approval, and only a few new chemical entities are approved by the US Food and Drug Administration (FDA) each year. Therefore it is of utmost importance to obtain the maximum amount of information about biological activity, toxicological profile, biochemical mechanisms, and off-target interactions of drug-candidate leads in the earliest stages of drug discovery. Cell-based assays, because of their peculiar advantages of predictability, possibility of automation, multiplexing, and miniaturization, seem the most appealing tool for the high demands of the early stages of the drug-discovery process. Nevertheless, cellular screening, relying on different strategies ranging from reporter gene technology to protein fragment complementation assays, still presents a variety of challenges. This review focuses on main advantages and limitations of different cell-based approaches, and future directions and trends in this fascinating field.