Medication compounding gained national attention in the fall of 2012 after contaminated compounded medications produced in the New England Compounding Center infected 800 people with fungal meningitis and led to several fatalities. This prompted Congress to pass regulations on compounding through the Drug Quality and Security Act (DQSA) in 2013. The act increased oversight of patient-specific drug compounding taking place in compounding pharmacies, created 503(b) outsourcing facilities to obtain compounded drugs, and added regulations for obtaining compounded drugs from traditional 503(a) pharmacies. These regulations also had a broader overall impact by triggering federal and state-specific policies, which have ultimately limited a physician's ability to perform low-risk, in-office compounding. This article provides an overview of the different types of compounding restrictions, reviews the current federal and state regulations and/or guidelines, discusses how newly proposed policies may affect the practice of dermatology, and presents an algorithm on how the practicing dermatologist should approach compounding. J Drugs Dermatol. 2018;17(7 Suppl):s17-22.