Letters of reference (LORs) are a common component of the application process for residency training programs. With the United States Medical Licensing Examination Step 1 transitioning to pass/fail grading and with the increasing use of holistic review, the potential role of LORs is rising in importance. Among some key benefits are the ability to provide a broader and more holistic view of applicants, which can include highlighting elements of experiences or skills that could be missed in their application, as well as providing a third-party assessment of the applicant external to their rotation experiences. However, LORs also face issues, including variation in quality, challenges with comparability, and risk of bias. In this article, the authors discuss the unique benefits, limitations, and best practice recommendations for LORs in academic medicine. The authors also discuss future directions, including the role of artificial intelligence, unblinded, and co-created LORs.