Atomic-scale molecular dynamics and free energy calculations in explicit aqueous solvent are used to study the complex mechanism by which a molecule can intercalate between successive base pairs of the DNA double helix. We have analyzed the intercalation pathway for the anticancer drug daunomycin using two different methods: metadynamics and umbrella sampling. The resulting free energy pathways are found to be consistent with one another and point, within an equilibrium free energy context, to a three-step process. Daunomycin initially binds in the minor groove of DNA. An activated step then leads to rotation of the drug, coupled with DNA deformation that opens a wedge between the base pairs, bends DNA toward the major groove, and forms a metastable intermediate that resembles structures seen within the interfaces between DNA and minor-groove-binding proteins. Finally, crossing a small free energy barrier leads to further rotation of daunomycin and full intercalation of the drug, reestablishing stacking with the flanking base pairs and straightening the double helix.