Peptides are ideally suited to mimic natural ligands and thereby function in an antagonistic or agonistic way. Furthermore they are able to physiologically disrupt functional complexes due to their small size and specific binding properties. Proteins form homo- or heteromeric (macro)molecular complexes and intricate networks by interacting with small molecules, peptides, nucleic acids or other proteins. On average, five interaction partners have been estimated for any given cellular protein, illustrating the complexity of the formed ‘interactomes’ and the impact of their investigation. Many protein-protein interactions are mediated by hot-spots, which comprise only a small part of the large binding interface but account for 80% of the binding energy. Thus, these hot spots provide an ‘Achilles heel’ for pharmaceutical interventions aiming at the disruption of functional protein-protein complexes. Methods to select peptides for defined target structures include display technologies on phages, ribosomes or yeast, and the yeast-two-hybrid system. Once selected, these peptides can be optimized for their binding affinity using peptide arrays. Stabilization of biologically unstable peptides is achieved by the introduction of non-natural amino acids to form so-called peptidomimetics that are resistant to cellular proteases. Moreover, lipocalins and peptide aptamers represent scaffolded binding structures with unique binding characteristics and enhanced stability. In case of extracellular targets, like cell surface receptors or pathogens in patients` plasma, peptide inhibitors have direct access. Addressing intracellular targets with peptides is more difficult since short hydrophilic peptides generally do not cross plasma membranes on their own. However, intracellular uptake of peptides can be achieved by coupling to carrier systems like liposomes or nanoparticles or upon fusion to a protein transduction domain. Alternatively, peptides may be expressed within cells after transduction with viral vectors in a gene therapy setting. This review will summarize the broad potential of peptides as drugs, with special emphasis on peptides which inhibit protein-protein interactions.