Chapter 5 focuses on the CALPHAD approach and its thermodynamic basis with the crucial concept of “phase." The origins, development, and principles of the CALPHAD method are briefly explained and current software is compiled (Thermo-Calc, Pandat, FactSage, and more). Thermodynamic modeling of Gibbs energy is introduced, from simple pure substances to complex solution phases. Examples of how to establish a thermodynamic database are given, and key issues on the consistency, coherency, quality assurance, and safety of the database are emphasized. The most important application examples in the computational design of alloys and their processing are separated in two levels. In the first level, solely thermodynamic CALPHAD databases are required. It is shown which type of calculations have proved most useful to guide design. In the second level, applications using extended CALPHAD-type databases with kinetic and thermophysical material parameters are outlined for casting, solidification, and heat treatment processes. The use of advanced CALPHAD-type software packages is demonstrated. Finally, a case study on design of Al alloys with improved hot cracking resistance is presented with these tools.