This study explores the repurposing of Food and Drug Administration (FDA)-approved drugs as potential inhibitors of SARS-CoV-2 papain-like protease (PLpro), a critical enzyme for viral replication. Initially, 3009 FDA approved drugs were screened to identify candidates structurally similar to the co-crystallized ligand XT7 in the SARS-CoV-2 PLpro complex (PDB ID: 7LBR). A fingerprint analysis narrowed the selection to the top 5% )150 drugs) most structurally akin to XT7, followed by a more refined structural similarity test that identified the top 1% (30 drugs). Molecular docking studies highlighted several compounds with strong binding affinities to the SARS-CoV-2 PLpro. Notably, Fedratinib exhibited a particularly robust binding energy of [Formula: see text]kcal/mol and was chosen for further investigation. Subsequent molecular dynamics (MD) simulations over 100 ns confirmed the stability and efficacy of Fedratinib’s binding, as evidenced by favorable energetic and dynamic profiles. The molecular mechanics-generalized born surface area (MM-GBSA) calculations corroborated these findings, revealing a binding energy of [Formula: see text]kcal/mol. Additionally, PLIP, ProLIF, and PCAT analyses further validated the stability and interactions of the PLpro-Fedratinib complex observed during the MD simulations. Overall, our results indicate that Fedratinib, an FDA-approved drug, demonstrates promising potential as an inhibitor of SARS-CoV-2 PLpro, warranting further in vitro and in vivo experimental validation as well as potential clinical evaluation.