Systems biology applies quantitative, mechanistic modelling to study genetic networks, signal transduction pathways and metabolic networks. Mathematical models of biochemical networks can look very different. An important reason is that the purpose and application of a model are essential for the selection of the best mathematical framework. Fundamental aspects of selecting an appropriate modelling framework and a strategy for model building are discussed. Concepts and methods from system and control theory provide a sound basis for the further development of improved and dedicated computational tools for systems biology. Identification of the network components and rate constants that are most critical to the output behaviour of the system is one of the major problems raised in systems biology. Current approaches and methods of parameter sensitivity analysis and parameter estimation are reviewed. It is shown how these methods can be applied in the design of model-based experiments which iteratively yield models that are decreasingly wrong and increasingly gain predictive power.