Subwavelength noble metal nanoparticles can sustain highly localized electromagnetic fields at the particle surfaces in the visible and near-IR range due to their unique optical properties and small size. These highly localized fields are due to the in phase motion of free electrons that can generate localized surface plasmon resonances (LSPRs) when in phase with the incoming electric field. The utilization of LSPRs in functional plasmonic nanocomposite systems has a wide variety of applications to technologies such as electronics and optoelectronics, biological sensing and testing, and the development of optical metamaterials which exhibit optical properties not found in nature. In this work, we examine the optical properties of three plasmonic nanocomposite systems using the computational electrodynamics simulation method known as the finite difference time domain (FDTD) method. We first develop an effective medium approximation of axially symmetric, anisotropic nanoparticles well-dispersed in a dielectric medium. We show that this method is robust to disorder and inhomogeneity making it an ideal tool for understanding anisotropy is plasmonic nanocomposites using simple experimental techniques such as spectroscopic ellipsometry. Next, we investigate the design parameters of an indirect nanodisk based biosensing platform to provide guidance for the development of more sensitive plasmonic sensors for biological applications. We also demonstrate the utility of the FDTD method to help understand conformational changes of biomacromolucules on the sensor through studying a model liposome deformation. Finally, we study the induced magnetic resonance in a polymer core decorated with noble metal nanobeads. We use the FDTD method to show that for induced magnetic resonances at optical frequencies, gold is a superior material over silver despite silver commonly being quoted as a better plasmonic material. Surprisingly, we also show, to our knowledge, the first demonstration of observable far-field magnetic quadrupole resonances in solution-phase metamolecules. These results can help guide future developments in a wide variety of optically active plasmonic nanocomposite materials.