The multipole concept, which characterizes the spacial distribution of scalar and vector objects by their angular dependence, has already become widely used in various areas of physics. In recent years it has become employed to systematically classify the anisotropic distribution of electrons and magnetization around atoms in solid state materials. This has been fuelled by the discovery of several physical phenomena that exhibit unusual higher rank multipole moments, beyond that of the conventional degrees of freedom as charge and magnetic dipole moment. Moreover, the higher rank electric=magnetic multipole moments have been suggested as promising order parameters in exotic hidden order phases. While the experimental investigations of such anomalous phases have provided encouraging observations of multipolar order, theoretical approaches have developed at a slower pace. In particular, a materials’ specific theory has been missing. The multipole concept has furthermore been recognized as the key quantity which characterizes the resultant configuration of magnetic moments in a cluster of atomic moments. This cluster multipole moment has then been introduced as macroscopic order parameter for a noncollinear antiferromagnetic structure in crystals that can explain unusual physical phenomena whose appearance is determined by the magnetic point group symmetry. It is the purpose of this review to discuss the recent developments in the first-principles theory investigating multipolar degrees of freedom in condensed matter systems. These recent developments exemplify that ab initio electronic structure calculations can unveil detailed insight in the mechanism of physical phenomena caused by the unconventional, multipole degree of freedom.