Background: The aim of the present study was to understand hospital pharmacists’ views and practices regarding generic substitution and therapeutic interchange. Method: This was a qualitative study involving pharmacists from three Western Saudi governorates: Taif, Makkah, and Jeddah. It included respondents from the Ministry of Health (MoH), military and private hospitals. Pharmacists were selected using a convenient sampling technique and data were collected using a structured face-to-face interview. Results: Fifty-seven pharmacists agreed to participate in this study. In MoH and private hospitals, generic substitution is a pharmacist-initiated act, while therapeutic interchange requires physician approval. Medication unavailability, side effects, patient characteristics, outcomes, and economic status justified most substitution decisions. In military hospitals, both types of substitutions are controlled by an auto-switch policy and physicians should be informed. In all hospitals, there are policies regulating substitution. Medications eligible for interchange mentioned by pharmacists from different hospitals were comparable to some extent. Pharmacists from the private sector considered substitution a supportive economic measure for both hospitals and patients. Most pharmacists highlighted that patient convenience and physician approval are the most challenging situations in substitution practice. Conclusions: An enhanced understanding of substitution and knowledge about medications included in the hospital formulary will be valuable support to the implementation of substitution practice which responds to the patients’ needs to improve their outcomes.