Good progress has been made to modernize traditional Chinese medicines by obtaining active components from natural herbs. In this review, some recent works on procuring active components and modernizing traditional Chinese medicines will be covered. In addition, some recent works on drug design using modern drug design tools have been described. With some well defined targets, the traditional Chinese medicine databases have been screened so as to identify those compounds for which the potential as a drug candidate was not known before. Among these studies, two have been selected as examples to be discussed in details. First, new anti-HIV candidates have been detected, namely leucovorin and agaritine derivatives. Subsequently, GTS-21 is proved to be a good candidate for Alzheimer's disease. All these findings may provide useful information for finding effective drug candidates with lower cost.