Adverse drug events (ADEs) are all too common in older patients. Although there are multiple causes for the ADEs in the elderly, alterations in pharmacokinetics (PK) and pharmacodynamics (PD) are frequent culprits. These alterations in PK and PD may be part of the normal aging process. Older patients often develop significant drug-related problems when alterations in PK and PD are not appropriately accounted for in prescribing and monitoring of medications. Clinically, the most significant PK changes that occur in aging are renal elimination and metabolism of drugs. In general, renal function declines with aging, necessitating dosage adjustments for drugs with renal-elimination pathways. The ability of the liver to metabolize certain drugs may also decline as a consequence of the aging process. From a PD standpoint, exaggerated responses are frequent, and often it is the side effects of medications that become exaggerated, rather than the therapeutic effects. Drugs affecting the central nervous system are particularly prone to PD alterations. Because of the PK and PD changes, vigilant monitoring of both therapeutic and adverse effects is mandatory in older patients. Based on PK and PD differences between middle-aged and elderly patients, there are certain medications that should almost always be avoided in older people. In addition, because older people tend to use more medications, the incidence of drug-drug interactions becomes more prevalent. Most of the drug-drug interactions that adversely impact older people involve both PK and PD mechanisms. Pharmacists and all prescribers must have a sound understanding of PK and PD effects of medications used in older people to provide optimal care and avoid preventable drug-related problems.