We review the state of dynamical downscaling with scale-constrained regional and global models. The methodology, in particular spectral nudging, has become a routine and well-researched tool for hindcasting climatologies of sub-synoptic atmospheric disturbances in coastal regions. At present, the spectrum of applications is expanding to other phenomena, but also to ocean dynamics and to extended forecasting. Also new diagnostic challenges are appearing such as spatial characteristics of small-scale phenomena such as Low Level Jets.