In pharmaco-epidemiology, the use of drugs is the determinant of interest when studying exposure-outcome associations. The increased availability of computerized information about drug use on an individual basis has greatly facilitated analyses of drug effects on a population-based scale. It seems likely that many negative findings in the early days of pharmaco-epidemiology can be explained by non-differential misclassification because of too simple (yes/no) exposure measures. In this paper, the authors discuss the importance of an adequate definition of drug exposure in pharmaco-epidemiological research and how this time-varying determinant can be analyzed in cohort studies. To reduce the risk of non-differential misclassification, a precise definition of exposure is mandatory and it is important to distinguish the complete follow-up period of a population into mutually exclusive episodes of non-use, past use and current use for each individual. By analyzing exposure to drugs as a time-dependent variable in a Cox regression model, cohort studies with complete coverage of all filled prescriptions can provide us with valid and precise risk estimates of drug-outcome associations. However, such estimates may be biased in the presence of time-dependent confounders which are themselves affected by prior exposure.