To improve the efficiency of existing perovskite solar cells (PSCs), a detailed understanding of the underlying device physics during their operation is essential. Here, a device model has been developed and validated that describes the operation of PSCs and quantitatively explains the role of contacts, the electron and hole transport layers, charge generation, drift and diffusion of charge carriers and recombination. The simulation to the experimental data of vacuum‐deposited CH3NH3PbI3 solar cells over multiple thicknesses has been fit and the device behavior under different operating conditions has been studied to delineate the influence of the external bias, charge‐carrier mobilities, energetic barriers for charge injection/extraction and, different recombination channels on the solar cell performance. By doing so, a unique set of material parameters and physical processes that describe these solar cells is identified. Trap‐assisted recombination at material interfaces is the dominant recombination channel limiting device performance and passivation of traps increases the power conversion efficiency (PCE) of these devices by 40%. Finally, guidelines to increase their performance have been issued and it is shown that a PCE beyond 25% is within reach. A numerical model is developed and validated that describes the operation of perovskite solar cells and quantitatively explains the role of contacts, the charge transport layers, charge generation, drift and diffusion of carriers and recombination. By doing so, a unique set of material parameters and physical processes is identified that describes these solar cells. To increase their performance, some guidelines are issued.