Over the past two decades, directed evolution has transformed the field of protein engineering. The advances in understanding protein structure and function, in no insignificant part a result of directed evolution studies, are increasingly empowering scientists and engineers to device more effective methods for manipulating and tailoring biocatalysts. Abandoning large combinatorial libraries, the focus has shifted to small, functionally rich libraries and rational design. A critical component to the success of these emerging engineering strategies are computational tools for the evaluation of protein sequence datasets and the analysis of conformational variations of amino acids in proteins. Highlighting the opportunities and limitations of such approaches, this review focuses on recent engineering and design examples that require screening or selection of small libraries.