N-Methylation is one of the simplest chemical modifications often occurring in peptides and proteins of prokaryotes and higher eukaryotes. Over years of evolution, nature has employed N-methylation of peptides as an ingenious technique to modulate biological function, often as a mode of survival through the production of antibiotics. This small structural change can not only mobilize large protein complexes (as in the histone methylation), but also inhibits the action of enzymes by selective recognition of protein–protein interaction surfaces. In recent years through the advancement in synthetic approaches, the potential of N-methylation has begun to be revealed, not only in modulating biological activity and selectivity as well as pharmacokinetic properties of peptides, but also in delivering novel drugs. Herein, we summarize the current knowledge of the versatility of N-methylation in modulating biological, structural, and pharmacokinetic properties of peptides.