Understanding how population dynamics are influenced by species interactions and the surrounding community is crucial for addressing many ecological questions, but requires modelling of complex systems involving direct, indirect and often asymmetric species interactions. Progress in developing multispecies models that can tackle this task is being made in multiple subfields of ecology, often with varying approaches and end goals but also facing shared challenges. We review some of the main challenges and the ways in which they are being addressed, highlighting a wide variety of methods that can support the development of multispecies models for understanding population dynamics. The main challenges that we examine are estimation of species interactions from limited data, the necessity of simplifications, and handling uncertainty in complex, multispecies models. In addition to reviewing a wide variety of approaches and methods for dealing with these challenges, we discuss future directions and make suggestions for how we believe the development of multispecies models for understanding population dynamics can move forward more efficiently.