There is a strong connection between the formation of a disk galaxy and the properties of the interstellar medium (ISM). Theoretical work has typically either focused on the cosmological buildup of a galaxy with a relatively crude model for the gas physics, or examined local processes in the ISM and ignored the global evolution of the galaxy itself. Here, I briefly review what has been learned from both of these approaches, and what can be done to bridge the gap between them. I argue that cosmological simulations need to learn from observational and theoretical work on local ISM properties and adopt more sophisticated models for the processes that they cannot resolve. Since the ISM is still incompletely understood, there are a number of reasonable approaches for these “subgrid" models, and I will discuss the strengths and limitations of each.