In recent years remarkable advances have been made in the development of phys-ics based models of various parts of the solar-terrestrial system (see JASTP special issues, October, November 2004; February 2007). In this paper, we focus our dis-cussions in a specific region of the Sun to the Earth’s environment (i.e. 1 AU). It is well-known that geomagnetic storms are caused by solar eruptions. The conse-quences of these storms include particle acceleration, solar wind impact on the Earth’s magnetosphere and ionosphere, UV-EUV radiation effects on the lower at-mosphere, etc. One of the main challenges is to predict the arrival time at 1 AU of the solar disturbance. The prospects look good for an accurate, real-time forecast scheme built on the acquisition of solar, heliosphere and the near-Earth data and large-scale models. However, the accuracy of these models still needs improve-ment. We will discuss the present status of the models and challenges to improve the simulation models.