The most common behavioral test of hippocampus-dependent, spatial learning and memory is the Morris water task, and the most commonly studied behavioral correlate of hippocampal neurons is the spatial specificity of place cells. Despite decades of intensive research, it is not completely understood how animals solve the water task and how place cells generate their spatially specific firing fields. Based on early work, it has become the accepted wisdom in the general neuroscience community that distal spatial cues are the primary sources of information used by animals to solve the water task (and similar spatial tasks) and by place cells to generate their spatial specificity. More recent research, along with earlier studies that were overshadowed by the emphasis on distal cues, put this common view into question by demonstrating primary influences of local cues and local boundaries on spatial behavior and place-cell firing. This paper first reviews the historical underpinnings of the "standard" view from a behavioral perspective, and then reviews newer results demonstrating that an animal's behavior in such spatial tasks is more strongly controlled by a local-apparatus frame of reference than by distal landmarks. The paper then reviews similar findings from the literature on the neurophysiological correlates of place cells and other spatially correlated cells from related brain areas. A model is proposed by which distal cues primarily set the orientation of the animal's internal spatial coordinate system, via the head direction cell system, whereas local cues and apparatus boundaries primarily set the translation and scale of that coordinate system.