For a decade, it has been observed that there is a remarkable decrease in the quantum of novel clinically approved drugs, in spite of modernization in the research and development process. We have highlighted repositioning of drugs as a methodology that has found new therapeutic implications for clinically approved drugs but with different indications. This can be considered as an upbringing strategy to deliver timely and cost-effective solutions, which still need exploration for getting over the shortage of novel drugs reaching the market. This review focuses on an activity-based drug repositioning approach, which is used to explore new uses of known drugs that are already approved for specific indications and are now being used for other indications on the basis that a single drug interacts with multiple targets. It also includes current research trends related to drug repositioning, which depends on strong knowledge of medicinal chemistry and involves elucidation of mechanisms of action and validation of novel targets. The review highlights the importance of computational tools and databases of various forms for drug repositioning purposes, which have enhanced the ability to pose reasonable and testable hypotheses. The critical nature of this aspect is obvious in cases where data gathered from in vitro, or animal models do not confirm in subsequent clinical trials. Hence, considering the positive outcomes of drug repositioning, it can be surmised that this approach can serve as a promising one that can develop into a robust drug discovery strategy.