One of the more challenging issues in medicinal chemistry is the computation of the free energy of ligand binding to macromolecular targets. This allows for the screening of libraries of chemicals for fast and inexpensive identification of lead compounds. Many attempts have been made and several algorithms have been developed for this purpose. Whereas enthalpic contributions are evaluated using methods and equations for which there is a reasonable consensus among researchers, the entropic contribution is evaluated using very different, and, in some cases, very approximate methods, or it is entirely ignored. Entropic contributions are of primary importance in the formation of many ligand-protein complexes, as well as in protein folding. The hydrophobic interaction, associated with the release of water molecules from the protein active site and the ligand, plays a significant role in complex formation, predominantly contributing to the total entropy change and, in some cases, to the total free energy of binding. There are distinct approaches for the evaluation of the contribution of water molecules to the free energy of binding based on Newtonian mechanics force fields, multi-parameter empirical scoring functions and experimental force fields. This review describes these methods -- discussing both their advantages and limitations. Particular emphasis will be placed on HINT (Hydropatic INTeractions), a "natural" force field that takes into account in a unified way enthalpic and entropic contributions of all interacting atoms in protein-ligand complexes, including released and structured water molecules. As a case-study, the contribution of water molecules to the binding free energy of HIV-1 protease inhibitors is evaluated.