Evidence for a human contribution to climatic changes during the past century is accumulating rapidly. Given the strength of the evidence, it seems natural to ask whether forcing projections can be used to forecast climate change. A Bayesian method for post-processing forced climate model simulations that produces probabilistic hindcasts of inter-decadal temperature changes on large spatial scales is proposed. Hindcasts produced for the last two decades of the 20th century are shown to be skillful. The suggestion that skillful decadal forecasts can be produced on large regional scales by exploiting the response to anthropogenic forcing provides additional evidence that anthropogenic change in the composition of the atmosphere has influenced our climate. In the absence of large negative volcanic forcing on the climate system (which cannot presently be forecast), the global mean temperature for the decade 2000-2009 is predicted to lie above the 1970-1999 normal with probability 0.94. The global mean temperature anomaly for this decade relative to 1970-1999 is predicted to be 0.35C (5-95% confidence range: 0.21C-0.48C). Reconstruction of temperature variability of the past centuries using climate proxy data can also provide important information on the role of anthropogenic forcing in the observed 20th century warming. A state-space model approach that allows incorporation of additional non-temperature information, such as the estimated response to external forcing, to reconstruct historical temperature is proposed. An advantage of this approach is that it permits simultaneous reconstruction and detection analysis as well as future projection. A difficulty in using this approach is that estimation of several unknown state-space model parameters is required. To take advantage of the data structure in the reconstruction problem, the existing parameter estimation approach is modified, resulting in two new estimation approaches. The competing estimation approaches are compared based on theoretical grounds and through simulation studies. The two new estimation approaches generally perform better than the existing approach. A number of studies have attempted to reconstruct hemispheric mean temperature for the past millennium from proxy climate indicators. Different statistical methods are used in these studies and it therefore seems natural to ask which method is more reliable. An empirical comparison between the different reconstruction methods is considered using both climate model data and real-world paleoclimate proxy data. The proposed state-space model approach and the RegEM method generally perform better than their competitors when reconstructing interannual variations in Northern Hemispheric mean surface air temperature. On the other hand, a variety of methods are seen to perform well when reconstructing decadal temperature variability. The similarity in performance provides evidence that the difference between many real-world reconstructions is more likely to be due to the choice of the proxy series, or the use of difference target seasons or latitudes, than to the choice of statistical method.