This thesis describes some attempts to model the effect of environment on a molecule, in particular, the effect of solvent and of the receptor site on the properties of a drug molecule. Chapter 1 describes the basic principles of drug activity, the forces responsible for binding of a drug to a receptor, and some of the consequences for drug design. Chapter 2 briefly reviews some of the quantitative structure-activity data available for angiotensin converting enzyme, and describes the design of a postulated active site by drawing an analogy with other zinc peptidases with known crystal structures. Chapter 3 briefly describes the assumptions made in the INDO semi-empirical molecular orbital method used in this study, and goes on to describe the way in which the wavefunctions obtained can be used to calculate quantities of interest to a consideration of drug-receptor interactions. The SOLVATON model for describing the effect of medium on a molecule is discussed, and some examples of its effect on small model systems are given. Finally, a method of modelling the receptor site of a drug molecule is described, and this is illustrated by its application to a model system. Chapter 4 describes the use of the INDO method in conjunction with the SOLVATON model and the receptor site modelling to obtain quantitative structure-activity relationships for a series of inhibitors of angiotensin converting enzyme. A failed attempt to model the course of reaction on a model substrate is briefly mentioned. Chapter 5 outlines some shortcomings in the methods applied, and makes suggestions for some improvements. Appendices describing the LCAO-SCF molecular orbital method, molecular mechanics and the torsion angle convention used are included, as is an appendix containing calculated indices for the compounds examined.