Eukaryotic mRNAs are appended at the 5' end, with the 7-methylguanosine cap linked by a 5'-5'-triphosphate bridge to the first transcribed nucleoside (m7GpppX). Initiation of cap-dependent translation of mRNA requires direct interaction between the cap structure and the eukaryotic translation initiation factor eIF4E. Biophysical studies of the association between eIF4E and various cap analogs have demonstrated that m(7)GTP binds to the protein ca. -5.0 kcal/mol more favorably than unmethylated GTP. In this work, a thermodynamic analysis of the binding process between eIF4E and several cap analogs has been conducted using Monte Carlo (MC) simulations in conjunction with free energy perturbation (FEP) calculations. To address the role of the 7-methyl group in the eIF4E/m7GpppX cap interaction, binding free energies have been computed for m(7)GTP, GTP, protonated GTP at N(7), the 7-methyldeazaguanosine 5'-triphosphate (m(7)DTP), and 7-deazaguanosine 5'-triphosphate (DTP) cap analogs. The MC/FEP simulations for the GTP -> m(7)DTP transformation demonstrate that half of the binding free energy gain of m 7 GTP with respect to GTP can be attributed to favorable van der Waals interactions with Trp166 and reduced desolvation penalty due to the N(7) methyl group. The methyl group both eliminates the desolvation penalty of the N(7) atom upon binding and creates a larger cavity within the solvent that further facilitates the desolvation step. Analysis of the pair m(7)GTP-m(7)DTP suggests that the remaining gain in affinity is related to the positive charge created on the guanine moiety due to the N(7) methylation. The charge provides favorable cation-pi interactions with Trp56 and Trp102 and decreases the negative molecular charge, which helps the transfer from the solvent, a more polar environment, to the protein.