Recent advances in applying electronic structure theory to understand the optical properties of metal clusters and their interactions with molecules are described. The studies have found that these methods can provide detailed insights into the microscopic origin of plasmonics. Experimental work on the absorption properties of small metal clusters provide the link between the small molecular-like clusters containing a few metal atoms and the bulk nanoparticles. Electronic structure methods are suited for describing the optical properties of these small clusters due to the importance of quantum size effects. The area of surface-enhanced spectroscopies benefits from the ever-increasing understanding of the optical properties of nanoparticles and our ability to fabricate structures with well-defined and reproducible optical properties. Challenge such as developing efficient methods to treat interactions of an electronically localized system are also addressed.
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