DNA-encoded chemical libraries (DELs) have emerged as a powerful technology in drug discovery. The wide adoption of DELs in the pharmaceutical industry and the rapid advancements of DEL-compatible chemistry have further fuelled its development and applications. In general, a DEL has been considered as a massive binding assay to identify physical binders for individual protein targets. However, recent innovations demonstrate the capability of DELs to operate in the complex milieu of biological systems. In this Perspective, we discuss the recent progress in using DNA-encoded chemical libraries to interrogate complex biological targets and their potential to identify structures that elicit function or possess other useful properties. Future breakthroughs in these aspects are expected to catapult DEL to become a momentous technology platform not only for drug discovery but also to explore fundamental biology.