Many classes of bioactive drug-like molecules derived from traditional herbal plants are becoming attractive as alternative medicines for the treatment of severe chronic diseases such as cancer and obesity. A set of chemically synthesized drugs that is capable of both inhibiting cancer growth and reducing body weight for treatment of obesity have severe side effects including nausea, vomiting, diarrhea as well as producing increased blood pressure and headache, respectively. For decades, drug candidates from herbal plants have been considered as potential therapeutic agents because they are generally safer, less toxic, and have fewer lethal side effects than chemically synthesized or semi-synthetic drugs. Understanding the key factors affecting pharmacological effects and clinical outcomes has been a critical theme of natural product research. However, standardized sample preparation methods, well-controlled scientific studies, and validation studies are needed before herbal therapeutics can be introduced into the global market. This review will address the current advances in using traditional herbal plants, including the pharmacological effects and the challenges faced during the development of new drugs. The safety issues associated with toxicity and the effectiveness of the herbs in specific diseases such as cancer and obesity are also discussed.