Modeling and simulation of fluid flow in subsurface fractured systems has been steadily a popular topic in petroleum industry. The huge potential hydrocarbon reserve in naturally and hydraulically fractured reservoirs has been a major stimulant for developments in this field. Although several models have found limited applications in studying fractured reservoirs, still more comprehensive models are required to be applied for practical purposes. A recently developed Embedded Discrete Fracture Model (EDFM) incorporates the advantages of two of the well-known approaches, the dual continuum and the discrete fracture models, to investigate more complex fracture geometries. In EDFM, each fracture is embedded inside the matrix grid and is discretized by the cell boundaries. This approach introduces a robust methodology to represent the fracture planes explicitly in the computational domain. As part of this research, the EDFM was implemented in two of The University of Texas in-house reservoir simulators, UTCOMP and UTGEL. The modified reservoir simulators are capable of modeling and simulation of a broad range of reservoir engineering applications in naturally and hydraulically fractured reservoirs. To validate this work, comparisons were made against a fine-grid simulation and a semi-analytical solution. Also, the results were compared for more complicated fracture geometries with the results obtained from EDFM implementation in the GPAS reservoir simulator. In all the examples, good agreements were observed. To further illustrate the application and capabilities of UTCOMP- and UTGEL-EDFM, a few case studies were presented. First, a synthetic reservoir model with a network of fractures was considered to study the impact of well placement. It was shown that considering the configuration of background fracture networks can significantly improve the well placement design and also maximize the oil recovery. Then, the capillary imbibition effect was investigated for the same reservoir models to display its effect on incremental oil recovery. Furthermore, UTCOMP-EDFM was applied for hydraulic fracturing design where the performances of a simple and a complex fracture networks were evaluated in reservoirs with different rock matrix permeabilities. Accordingly, it was shown that a complex network is an ideal design for a very low permeability reservoir, while a simple network results in higher recovery when the reservoir permeability is moderate. Finally, UTGEL-EDFM was employed to optimize a conformance control process. Different injection timings and different gel concentrations were selected for water-flooding processes and their impact on oil recovery was evaluated henceforth. / text