With the dramatic increase in the number of new chemical entities (NCEs) arising from combinatorial chemistry and modern high‐throughput bioassays, novel bioanalytical techniques are required for the rapid determination of the metabolic stability and metabolites of these NCEs. Knowledge of the metabolic site(s) of the NCEs in early drug discovery is essential for selecting compounds with favorable pharmacokinetic credentials and aiding medicinal chemists in modifying metabolic “soft spots”. In development, elucidation of biotransformation pathways of a drug candidate by identifying its circulatory and excretory metabolites is vitally important to understand its physiological effects. Mass spectrometry (MS) and nuclear magnetic resonance (NMR) have played an invaluable role in the structural characterization and quantification of drug metabolites. Indeed, liquid chromatography (LC) coupled with atmospheric pressure ionization (API) MS has now become the most powerful tool for the rapid detection, structure elucidation, and quantification of drug‐derived material within various biological fluids. Often, however, MS alone is insufficient to identify the exact position of oxidation, to differentiate isomers, or to provide the precise structure of unusual and/or unstable metabolites. In addition, an excess of endogenous material in biological samples often suppress the ionization of drug‐related material complicating metabolite identification by MS. In these cases, multiple analytical and wet chemistry techniques, such as LC‐NMR, enzymatic hydrolysis, chemical derivatization, and hydrogen/deuterium‐exchange (H/D‐exchange) combined with MS are used to characterize the novel and isomeric metabolites of drug candidates. This review describes sample preparation and introduction strategies to minimize ion suppression by biological matrices for metabolite identification studies, the application of various LC‐tandem MS (LC‐MS/MS) techniques for the rapid quantification and identification of drug metabolites, and future trends in this field. © 2007 Wiley Periodicals, Inc., Mass Spec Rev