PEGylation is a process in which one or more units of chemically activated polyethylene glycol reacts with a biomolecule, usually a protein, peptide, small molecule or oligonucleotide, creating a putative new molecular entity possessing physicochemical and physiological characteristics that are distinct from its predecessor molecules. In recent years, PEGylation has been used not only as a drug delivery technology but used also as a drug modification technology to transform existing biopharmaceuticals clinically more efficacious than before their PEGylation. PEGylation bestows several useful properties upon the native molecule, resulting in improved pharmacokinetic and pharmacodynamic properties, which in turn enable the native molecule to achieve maximum clinical potency. In addition, PEGylation results in sustained clinical response with minimal dose and less frequency of dosing, leading to improved quality of life via increased patient compliance and reduced cost. During the course of development of various pegylated protein therapeutics, several new insights have been gained. This review article focuses on the approaches, strategies and the utilization of modern PEGylation concepts in the design and development of well-characterized pegylated protein therapeutics.