Cyclooxygenases (COXs), the enzymes involved in the formation of prostaglandins from polyunsaturated fatty acids such as arachidonic acid, exist in two forms--the constitutive COX-1 that is cytoprotective and responsible for the production of prostaglandins and COX-2 which is induced by cytokines, mitogens and endotoxins in inflammatory cells and responsible for the increased levels of prostaglandins during inflammation. As a result COX-2 has become the natural target for the development of anti-inflammatory and anti-cancer drugs. While the conventional NSAIDs with gastric side effects inhibit both COX-1 and COX-2, the newly developed drugs for inflammation with no gastric side effects selectively block the COX-2 enzyme. NSAIDs, nonselective non-aspirin NSAIDs and COX-2 selective inhibitors, are being widely used for various arthritis and pain syndromes. Selective inhibitors of COX-2, however, convey a small but definite risk of myocardial infarction and stroke; the extent of which varies depending on the COX-2 specificity. In view of the gastric side effects of conventional NSAIDs and the recent market withdrawal of rofecoxib and valdecoxib due to their adverse cardiovascular side effects there is need to develop alternative anti-inflammatory agents with reduced gastric and cardiovascular problems. The present study reviews various Computer Aided Drug Design (CADD) approaches to develop Cyclooxygenase based anti-inflammatory and anti-cancer drugs.