Oral administration is the most important and preferred route of administration for small molecular weight conventional drugs. The overall bioavailability of an orally administered drug depends on many factors, including the physicochemical properties of the drug as well as the morphological and biochemical state of the intestinal epithelium. Our understanding of the factors governing oral delivery of drug molecules is far from complete. As a result, the approaches to solve the problems related to oral drug delivery are often empirical in nature. The multifaceted nature of the problems associated with poor oral bioavailability of drug molecules requires a systematic and reductionist approach to understand the underlying factors affecting the bioavailability and absorption of these molecules. Thus, use of appropriate in vitro models is extremely useful in elucidating the role of various physical and biochemical barriers (such as metabolic enzymes, drug transporters, and the multidrug resistance (MDR) P-glycoprotein) to drug absorption. In this chapter, we have discussed the use of one such in vitro model, i.e. the Caco-2 cells, in elucidating the roles of the physical and biochemical barriers to drug absorption posed by the intestinal epithelium. By using specific examples, we have illustrated how this improved understanding about the barriers to drug absorption can be used for the design and development of drug candidates with enhanced oral absorption.