The history of Integrated Assessment Modelling and climate change are closely interlinked, and as new information and ideas come to light, it becomes necessary to incorporate them into the Integrated Assessment Models (IAMs) currently used. This paper discusses different IAMs, how adaptation is currently being considered in these models, challenges involved in incorporating them, and their potential policy applications. Current IAMs address adaptation either by including it implicitly in damage cost estimates, or by making it a separate control variable altogether. The paper suggests that capturing the bottom-up characteristics of adaptation can improve its treatment within IAMs. The key conclusions of the paper are that until adaptation in IAMs is incorporated accurately to best fit ground conditions, these models may overestimate the net benefits brought about by specific adaptation activities. Additionally, such misleading results will also misrepresent the necessary level of mitigation required. The authors note that the spatial resolution needed to conduct an accurate estimated cost-benefit analysis of adaptation measures is often more at the local level, whereas most current models focus on the global level.