Carbon nanotubes (CNT) are proper tips for atomic force microscopes (AFMs) as a result of their small tip diameter, high aspect ratio, and high flexibility. For nanoscale imaging of soft biological specimens, a CNT tipped AFM is an ideal tool. In this article we review the application of CNTs as AFM tips and present related research about the forces applied from liquids on nanotubes. Then a dynamic mode CNT tipped AFM in liquid is modeled and simulated. The simulation results are compared with experimental results. For modeling and simulation, a continuous beam model and a forward-time simulation method are used. The simulation results show that when a CNT tip vibrates in liquid, the oscillation amplitude and resonance frequency are changed compared to the state of oscillation in air. The small structure of CNTs reduces the hydrodynamic forces, and the liquid environment reduces the adhesive forces between the CNT tip and the sample. These two factors make CNTs a good choice as an AFM tip.