The key to the advanced data binding of Telerik RadGrid is handling correctly the NeedDataSource event. That's why we chose this exact name. 'Need' in this case actually means that if at an exact moment the data-source property does not point to a valid data-source object, the grid will not behave correctly.

This event fires in the following cases:

• Right after OnLoad, Telerik RadGrid checks the viewstate for stored grid-related information. If such information is missing (when the page loads for the first time), the NeedDataSource event is fired. This also means that if MasterTableView.DataSourcePersistenceMode has been set to NoPersistence, grid would bind each time the page loads (not only the first time)
• After automatic sorting
• When paging event occurs
• When Edit command is fired
• Right after Update/Delete/Insert command event handlers finish execution. You can cancel these operations handling the ItemCommand event and assigning false value to the Canceled property of the e event argument
• When grouping/ungrouping columns - right after the RadGrid.GroupsChanging event is raised.
• When resorting a group
• When filtering column values
• When a call to the Rebind() grid method takes place
• Prior to any detail table binding
• In some other custom cases.

The advantages of using this event are that the developer does not need to write any code handling the logic about when and how the data-binding should be processed. It is still the developer's responsibility to construct properly a data source object and assign it to the RadGrid's DataSource property.
In the code of the NeedDataSource handler you should prepare the data source (list of objects) for Telerik RadGrid and assign it to the grid's DataSource property.

Note: You should never call the DataBind() method from inside the NeedDataSource handler or mix simple data-binding mode with advanced data-binding

Alternatively, you can use AccessDataSource/SqlDataSource/ObjectDataSource/XmlDataSource controls to populate Telerik RadGrid with data - this is another advanced data-binding mode of the control which allows automatic operations as well. See the Automatic operations/Editing XML using XmlDataSource control from the Insert/Update/Delete section of the online demos for more info.

Further information about the advanced data binding mechanism of Telerik RadGrid and the control's lifecycle is available here:
Advanced data binding
Chapter The control lifecycle