Our goal is to answer the question: compared with experimental structures, how useful are predicted models for functional annotation? We assessed the functional utility of predicted models by comparing the performances of a suite of methods for functional characterization on the predictions and the experimental structures. We identified 28 sites in 25 protein targets to perform functional assessment. These 28 sites included nine sites with known ligand binding (holo‐sites), nine sites that are expected or suggested by experimental authors for small molecule binding (apo‐sites), and Ten sites containing important motifs, loops, or key residues with important disease‐associated mutations. We evaluated the utility of the predictions by comparing their microenvironments to the experimental structures. Overall structural quality correlates with functional utility. However, the best‐ranked predictions (global) may not have the best functional quality (local). Our assessment provides an ability to discriminate between predictions with high structural quality. When assessing ligand‐binding sites, most prediction methods have higher performance on apo‐sites than holo‐sites. Some servers show consistently high performance for certain types of functional sites. Finally, many functional sites are associated with protein‐protein interaction. We also analyzed biologically relevant features from the protein assemblies of two targets where the active site spanned the protein‐protein interface. For the assembly targets, we find that the features in the models are mainly determined by the choice of template.