In vitro metabolite identification experiments using microsomes or other liver preparations are crucial components in the drug discovery and lead-optimization stages of compounds selection in the pharmaceutical industry. A selective and rapid method was developed for determination of phase I metabolites in human liver microsomal preparation using ultra performance liquid chromatography–tandem mass spectrometry. The metabolism of febuxostat was examined using human liver Microsomes (HLMs). The resulting four metabolites (M1-M4) were detected, out of these only M3 was not reported. The kinetic of M3 formation were calculated at 0 to 50 mins in HLMs. Moreover, a validated method of M3 in rat plasma was developed and successfully applied on pharmacokinetic studies. In addition, in silico metabolic studies were carried out to establish the M3 metabolite for febuxostat. The in silico toxicity studies showed that M3 is not likely to exhibit toxicity. Based on the results, a complete metabolic pathway for the febuxostat could be proposed.