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The potential of beta-cyclodextrins as a pharmaceutical aid has been established through several decades of research. However, some beta-cyclodextrins are reported to be toxic causing deleterious effects on long term usage. In the recent past, sulfobutyl ether beta-cyclodextrin, a modified beta-cyclodextrin has captured interest as a comparatively safer and effective beta-cyclodextrin for increasing the solubility and the bioavailability of biopharmaceutical classification system class II drugs. Sulfobutyl ether beta-cyclodextrin has demonstrated immense potential in addressing solubility and stability issues associated with formulation of drugs. Till date no comprehensive report on their utility in drug development has been published. Hence, this review focusses on the structure, properties, preparation techniques and applications of sulfobutyl ether beta-cyclodextrin inclusion complexes. Investigation of the feasibility of forming stable inclusion complexes of sulfobutyl ether beta-cyclodextrin and various drugs as guest molecules using molecular modelling techniques have been elaborated in the review. Incorporation of sulfobutyl ether beta-cyclodextrin complexes into novel drug delivery systems (liposomes and nanoformulations) have been summarized along with various methods of preparation and the clinical safety. Molecular modelling approach discussed in this review, coupled with wet-lab validation of the complexes, will enable a faster transit of the delivery systems into the clinical setting.