There are two main advantages of using a combined quantum mechanical and molecular mechanical (QM/MM) potential in molecular dynamics and Monte Carlo simulations. First, since only a small portion of the condensed phase system is treated by an explicit electronic structure method, combined QM/MM methods can be applied to large molecular systems along with extensive configurational sampling. Secondly, the accuracy of the QM model representing the solute molecule can be systematically improved by using larger basis sets and by including better treatment of electron correlation. Parallel to the QM treatment, the quality of the MM approximation for the solvent system can also be improved by including polarization terms to account for the mutual solute (QM) and solvent (MM) charge polarization. In this talk, I will summarize early studies and highlight some recent developments including the use of mixed molecular orbital and valence bond (MOVB) models and the incorporation of solvent polarization in combined QM/MM simulations.