Z-DNA, the alternative form of double-stranded DNA involved in a variety of nucleotide metabolism, is recognized and stabilized by specific Z-DNA binding proteins (ZBPs). Three ZBPs known in vertebrates -ADAR1, DAI and PKZ- modulate innate immunity, particularly, the IFN-induced immune response. The E3L protein of the vaccinia virus appears to compete with the host ZBP for Z-DNA binding, thereby suppressing the host immune system. ZBPs are, therefore, considered to be attractive therapeutic targets for infectious and immune diseases. Recent advances in computer-aided drug development combined with the high-resolution crystal and NMR structures of ZBPs have enabled us to discover novel candidates as ZBP inhibitors. In this study, we present an overview of Z-DNA and known ZBPs as drug targets, and summarize recent progress in the structure-based identification of ZBP inhibitors.