Molecular recognition is determined by the structure and dynamics of both a protein and its ligand, but it is difficult to directly assess the role of each of these players. In this study, we use Markov State Models (MSMs) built from atomistic simulations to elucidate the mechanism by which the Lysine-, Arginine-, Ornithine-binding (LAO) protein binds to its ligand. We show that our model can predict the bound state, binding free energy, and association rate with reasonable accuracy and then use the model to dissect the binding mechanism. In the past, this binding event has often been assumed to occur via an induced fit mechanism because the protein's binding site is completely closed in the bound state, making it impossible for the ligand to enter the binding site after the protein has adopted the closed conformation. More complex mechanisms have also been hypothesized, but these have remained controversial. Here, we are able to directly observe roles for both the conformational selection and induced fit mechanisms in LAO binding. First, the LAO protein tends to form a partially closed encounter complex via conformational selection (that is, the apo protein can sample this state), though the induced fit mechanism can also play a role here. Then, interactions with the ligand can induce a transition to the bound state. Based on these results, we propose that MSMs built from atomistic simulations may be a powerful way of dissecting ligand-binding mechanisms and may eventually facilitate a deeper understanding of allostery as well as the prediction of new protein-ligand interactions, an important step in drug discovery.