In this contribution we review the recent progress in the modeling of Pulsar Wind Nebulae (PWN). We start with a brief overview of the relevant physical processes in the magnetosphere, the wind-zone and the inflated nebula bubble. Radiative signatures and particle transport processes obtained from 3D simulations of PWN are discussed in the context of optical and X-ray observations. We then proceed to consider particle acceleration in PWN and elaborate on what can be learned about the particle acceleration from the dynamical structures called wisps observed in the Crab nebula. We also discuss recent observational and theoretical results of gamma-ray flares and the inner knot of the Crab nebula, which had been proposed as the emission site of the flares. We extend the discussion to GeV flares from binary systems in which the pulsar wind interacts with the stellar wind from a companion star. The chapter concludes with a discussion of solved and unsolved problems posed by PWN.
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