Development of lung models for testing a drug substance or delivery system has been an intensive area of research. However, a model that mimics physiological and anatomical features of human lungs is yet to be established. Although in vitro lung models, developed and fine-tuned over the past few decades, were instrumental for the development of many commercially available drugs, they are suboptimal in reproducing the physiological microenvironment and complex anatomy of human lungs. Similarly, intersubject variability and high costs have been major limitations of using animals in the development and discovery of drugs used in the treatment of respiratory disorders. To address the complexity and limitations associated with in vivo and in vitro models, attempts have been made to develop in silico and tissue-engineered lung models that allow incorporation of various mechanical and biological factors that are otherwise difficult to reproduce in conventional cell or organ-based systems. The in silico models utilize the information obtained from in vitro and in vivo models and apply computational algorithms to incorporate multiple physiological parameters that can affect drug deposition, distribution, and disposition upon administration via the lungs. Bioengineered lungs, on the other hand, exhibit significant promise due to recent advances in stem or progenitor cell technologies. However, bioengineered approaches have met with limited success in terms of development of various components of the human respiratory system. In this review, we summarize the approaches used and advancements made toward the development of in silico and tissue-engineered lung models and discuss potential challenges associated with the development and efficacy of these models.