Multicellular spheroids are three dimensional in vitro microscale tissue analogs. The current article examines the suitability of spheroids as an in vitro platform for testing drug delivery systems. Spheroids model critical physiologic parameters present in vivo, including complex multicellular architecture, barriers to mass transport, and extracellular matrix deposition. Relative to two-dimensional cultures, spheroids also provide better target cells for drug testing and are appropriate in vitro models for studies of drug penetration. Key challenges associated with creation of uniformly sized spheroids, spheroids with small number of cells and co-culture spheroids are emphasized in the article. Moreover, the assay techniques required for the characterization of drug delivery and efficacy in spheroids and the challenges associated with such studies are discussed. Examples for the use of spheroids in drug delivery and testing are also emphasized. By addressing these challenges with possible solutions, multicellular spheroids are becoming an increasingly useful in vitro tool for drug screening and delivery to pathological tissues and organs.This review focuses on key challenges associated with broader adaptation of spheroids to drug delivery and efficacy testing, to catalyze the enhanced use of multicellular spheroids as a rigorous in vitro tool for drug screening and delivery.