Experience indicates that applying the conventional testing techniques such as drawdown-buildup tests to unconventional reservoir may lead to non-unique answers. Diagnostic testing approach is now more commonly used in tight gas formations and unconventional reservoirs. Testing unconventional reservoirs, particularly hydrocarbon-bearing shale formations, presents considerable challenges. In addition determination of the fracture closure pressure is sometime elusive. This paper reviews those challenges faced in analysis of testing of tight gas and unconventional reservoirs both liquid and gas. Conventional testing and analysis methods, although applicable, are often impractical because of excessive test duration. Diagnostic fracture injection test (DFIT) has become the preferred option for unconventional formations. Several methods may be used for interpreting DFIT data. We examine those methods in detail and explore their relative strengths while interpreting field data. We also show ways to determine the fracture closure pressure under various reservoir and fracture conditions.