A new methodology, affinity capillary electrophoresis-mass spectrometry (ACE-MS), is introduced as a solution-based approach for screening combinatorial libraries for drug leads. The method allows on-line, one-step selection and structural identification of candidate ligands. ACE-MS is demonstrated using the binding of vancomycin to libraries of all-D-tri- and tetrapeptides as a model system. Peptide libraries of different forms of Fmoc-DDXX and Fmoc-EXX containing up to 361 compounds were successfully employed to determine interacting structural motifs. A consensus structure of the strongest interacting peptides consisted of D-Ala at the C-terminus and an aromatic amino acid in the penultimate position. Ligands with this structure bound more strongly to the receptor than the known ligand, D-Ala-D-Ala. A 1000 peptide library was also screened directly by ACE-MS. It was found that, for this and potentially larger libraries, incorporating an affinity solid phase extraction step prior to ACE-MS was effective in both removing a large number of non-interacting species as well as preconcentrating sample components for sequence determination by MS.