Next-generation sequencing is changing the paradigm of clinical genetic testing. Today there are numerous molecular tests available, including single-gene tests, gene panels, and exome sequencing or genome sequencing. As a result, ordering physicians face the conundrum of selecting the best diagnostic tool for their patients with genetic conditions. Single-gene testing is often most appropriate for conditions with distinctive clinical features and minimal locus heterogeneity. Next-generation sequencing-based gene panel testing, which can be complemented with array comparative genomic hybridization and other ancillary methods, provides a comprehensive and feasible approach for heterogeneous disorders. Exome sequencing and genome sequencing have the advantage of being unbiased regarding what set of genes is analyzed, enabling parallel interrogation of most of the genes in the human genome. However, current limitations of next-generation sequencing technology and our variant interpretation capabilities caution us against offering exome sequencing or genome sequencing as either stand-alone or first-choice diagnostic approaches. A growing interest in personalized medicine calls for the application of genome sequencing in clinical diagnostics, but major challenges must be addressed before its full potential can be realized. Here, we propose a testing algorithm to help clinicians opt for the most appropriate molecular diagnostic tool for each scenario.