Discovery toxicology focuses on the identification of the most promising drug candidates through the development and implementation of lead optimization strategies and hypothesis-driven investigation of issues that enable rational and informed decision-making. The major goals are to [a] identify and progress the drug candidate with the best overall drug safety profile for a therapeutic area, [b] remove the most toxic drugs from the portfolio prior to entry into humans to reduce clinical attrition due to toxicity, and [c] establish a well-characterized hazard and translational risk profile to enable clinical trial designs. This is accomplished through a framework that balances the multiple considerations to identify a drug candidate with the overall best drug characteristics and provides a cogent understanding of mechanisms of toxicity. The framework components include establishing a target candidate profile for each program that defines the qualities of a successful candidate based on the intended therapeutic area, including the risk tolerance for liabilities; evaluating potential liabilities that may result from engaging the therapeutic target (pharmacology-mediated or on-target) and that are chemical structure-mediated (off-target); and characterizing identified liabilities. Lead optimization and investigation relies upon the integrated use of a variety of technologies and models (in silico, in vitro, and in vivo) that have achieved a sufficient level of qualification or validation to provide confidence in their use. We describe the strategic applications of various nonclinical models (established and new) for a holistic and integrated risk assessment that is used for rational decision-making. While this review focuses on strategies for small molecules, the overall concepts, approaches, and technologies are generally applicable to biotherapeutics.