Water has been recognized as one of the major structuring factors in biological macromolecules. Indeed, water clusters influence many aspects of biological function, and the water-protein interaction has long been recognized as a major determinant of chain folding, conformational stability, internal dynamics, binding specificity and catalysis. I discuss here several themes arising from recent progress in understanding structural aspects of 'direct' and 'indirect' ligands in terms of enzyme-substrate interactions, and the role of water bridges in enzyme catalysis. The review also attempts to illuminate issues relating to efficiency, through solvent interactions associated with enzymic specificity, and versatility. Over the years, carbonic anhydrase (CA; carbonate hydrolyase, EC 4.2.1.1) has played a significant role in the continuing delineation of principles underlying the role of water in enzyme reactions. As a result of its pronounced catalytic power and robust constitution CA was transformed into a veritable 'laboratory' in which active site mechanisms were rigorously tested and explored.