The interstellar medium (ISM) is intimately related with star formation processes, being both the fuel for star formation and a place where star formation feedback strongly shapes the thermodynamics and morphology of various gas phases. In this talk, I will summarize the components of the ISM focusing largely on the key observational results and outstanding questions. I will then specifically examine the current status of our understanding of the neutral ISM and its connection with molecular gas, as the first step in the process of star formation. As numerical simulations of galaxy formation continue to include more detailed ISM physics, statistical comparisons between simulations and observations are essential for informing numerical simulations, as well as obtaining more in-depth observational constraints. I will highlight some resent results and point out potential future needs and advances.