Water splitting by artificial catalysts is a critical process in the production of hydrogen gas as an alternative fuel. In this paper, we examine the essential role of theoretical calculations, with particular focus on density functional theory (DFT), in understanding the water-splitting reaction on these catalysts. First, we present an overview of DFT thermochemical calculations on water-splitting catalysts, addressing how these calculations are adapted to condensed phases and room temperature. We show how DFT-derived chemical descriptors of reactivity can be surprisingly good estimators for reactive trends in water-splitting catalysts. Using this concept, we recover trends for bulk catalysts using simple model complexes for at least the first-row transition-metal oxides. Then, using the CoPi cobalt oxide catalyst as a case study, we examine the usefulness of simulation for predicting the kinetics of water splitting. We demonstrate that the appropriate treatment of solvent effects is critical for computing accurate redox potentials with DFT, which, in turn, determine the rate-limiting steps and electrochemical overpotentials. Finally, we examine the ability of DFT to predict mechanism, using ruthenium complexes as a focal point for discussion. Our discussion is intended to provide an overview of the current strengths and weaknesses of the state-of-the-art DFT methodologies for condensed-phase molecular simulation involving transition metals and also to guide future experiments and computations toward the understanding and development of novel water-splitting catalysts.