Understanding how proteins recognize DNA in a sequence-specific manner is central to our understanding of the regulation of transcription and other cellular processes. In this article we review the principles of DNA recognition that have emerged from the large number of high-resolution crystal structures determined over the last 10 years. The DNA-binding domains of transcription factors exhibit surprisingly diverse protein architectures, yet all achieve a precise complementarity of shape facilitating specific chemical recognition of their particular DNA targets. Although general rules for recognition can be derived, the complex nature of the recognition mechanism precludes a simple recognition code. In particular, it has become evident that the structure and flexibility of DNA and contacts mediated by water molecules contribute to the recognition process. Nevertheless, based on known structures it has proven possible to design proteins with novel recognition specificities. Despite this considerable practical success, the thermodynamic and kinetic properties of protein/DNA recognition remain poorly understood.