Hydrogels are highly water-swollen molecular networks that are ideal platforms to create tissue mimetics owing to their vast and tunable properties. As such, hydrogels are promising cell-delivery vehicles for applications in tissue engineering and have also emerged as an important base for ex vivo models to study healthy and pathophysiological events in a carefully controlled three-dimensional environment. Cells are readily encapsulated in hydrogels resulting in a plethora of biochemical and mechanical communication mechanisms, which recapitulates the natural cell and extracellular matrix interaction in tissues. These interactions are complex, with multiple events that are invariably coupled and spanning multiple length and time scales. To study and identify the underlying mechanisms involved, an integrated experimental and computational approach is ideally needed. This review discusses the state of our knowledge on cell−hydrogel interactions, with a focus on mechanics and transport, and in this context, highlights recent advancements in experiments, mathematical and computational modeling. The review begins with a background on the thermodynamics and physics fundamentals that govern hydrogel mechanics and transport. The review focuses on two main classes of hydrogels, described as semiflexible polymer networks that represent physically cross-linked fibrous hydrogels and flexible polymer networks representing the chemically cross-linked synthetic and natural hydrogels. In this review, we highlight five main cell− hydrogel interactions that involve key cellular functions related to communication, mechanosensing, migration, growth, and tissue deposition and elaboration. For each of these cellular functions, recent experiments and the most up to date modeling strategies are discussed and then followed by a summary of how to tune hydrogel properties to achieve a desired functional cellular outcome. We conclude with a summary linking these advancements and make the case for the need to integrate experiments and modeling to advance our fundamental understanding of cell−matrix interactions that will ultimately help identify new therapeutic approaches and enable successful tissue engineering.