Phenotypic drug discovery (PDD) represents a vital source of first-in-class drug innovation; however, its central bottleneck — demonstrating efficacy without a clear mechanism of action — remains a fundamental challenge in modern medicinal chemistry. This review discusses how chemical biology serves as a critical link between phenotypic screening and target validation, leveraging an integrated technological repertoire — including chemical proteomics, genetically encoded biosensors, and chemical genetics — to seamlessly connect phenotypic assays with target deconvolution, thereby accelerating the iterative cycle of "phenotypic investigation → target identification → medicinal chemistry optimization". Drawing upon cutting-edge modalities such as proteolysis targeting chimera (PROTACs) and molecular glues, we analyze the pivotal role of chemical biology in lead discovery, target deconvolution, mechanistic elucidation, and the design of novel drug modalities. Looking forward, the field is poised to deeply integrate artificial intelligence (AI)-driven drug design and single-cell chemical genomics to tackle previously undruggable targets and drive the modern revival of natural products. Concurrently, its research paradigm is shifting from a narrow focus on molecular mechanisms toward a systems-level regulation of biological networks, ultimately laying a solid technological foundation for precision medicine and the development of next-generation therapeutic modalities.