The use of fish embryos is not regulated by current legislations on animal welfare and is therefore considered as a refinement, if not replacement of animal experiments. Fish embryos represent an attractive model for environmental risk assessment of chemicals since they offer the possibility to perform small-scale, high-throughput analyses. Beyond their application for determining the acute toxicity, fish embryos are also excellent models for studies aimed at the understanding of toxic mechanisms and the indication of possible adverse and long-term effects. Therefore, we have reviewed the scientific literature in order to indicate alternative applications of the fish embryo model with focus on embryos of the zebrafish. The analysis of the mode of action is important for the risk assessment of environmental chemicals and can assist in indicating adverse and long-term effects. Toxicogenomics present a promising approach to unravel the potential mechanisms. Therefore, we present examples of the use of zebrafish embryos to study the effect of chemicals on gene and protein patterns, and the potential implications of differential expression for toxicity. The possible application of other methods, such as kinase arrays or metabolomic profiling, is also highlighted. Furthermore, we show examples of toxicokinetic studies (bioconcentration, ABC transporters) and discuss limitations that might be caused by the potential barrier function of the chorion. Finally, we demonstrate that biomarkers of endocrine disruption, immune modulation, genotoxicity or chronic toxicity could be used as indicators or predictors of sub-acute and long-term effects. The zebrafish embryo represents a model with an impressive range of possible applications in environmental sciences. Particularly, the adaptation of molecular, system-wide approaches from biomedical research is likely to extend its use in ecotoxicology. Challenges for future research are (1) the identification of further suitable molecular markers as indicators of the mode of action, (2) the establishment of strong links between (molecular) effects in short-term assays in embryos and long-term (toxic) effects on individuals, (3) the definition of limitations of the model and (4) the development of tests that can be used for regulatory purposes.