We review recent developments in our understanding of molecular recognition and ligand association, focusing on two major viewpoints: (a) studies that highlight new physical insight into the molecular recognition process and the driving forces determining thermodynamic signatures of binding and (b) recent methodological advances in applications to protein-ligand binding. In particular, we highlight the challenges posed by compensating enthalpic and entropic terms, competing solute and solvent contributions, and the relevance of complex configurational ensembles comprising multiple protein, ligand, and solvent intermediate states. As more complete physics is taken into account, computational approaches increase their ability to complement experimental measurements, by providing a microscopic, dynamic view of ensemble-averaged experimental observables. Physics-based approaches are increasingly expanding their power in pharmacology applications.