We simulate the folding/unfolding equilibrium of the 20-residue miniprotein Trp-cage. We use replica exchange molecular dynamics simulations of the AMBER94 atomic detail model of the protein explicitly solvated by water, starting from a completely unfolded configuration. We employ a total of 40 replicas, covering the temperature range between 280 and 538 K. Individual simulation lengths of 100 ns sum up to a total simulation time of about 4 micros. Without any bias, we observe the folding of the protein into the native state with an unfolding-transition temperature of about 440 K. The native state is characterized by a distribution of root mean square distances (RMSD) from the NMR data that peaks at 1.8A, and is as low as 0.4A. We show that equilibration times of about 40 ns are required to yield convergence. A folded configuration in the entire extended ensemble is found to have a lifetime of about 31 ns. In a clamp-like motion, the Trp-cage opens up during thermal denaturation. In line with fluorescence quenching experiments, the Trp-residue sidechain gets hydrated when the protein opens up, roughly doubling the number of water molecules in the first solvation shell. We find the helical propensity of the helical domain of Trp-cage rather well preserved even at very high temperatures. In the folded state, we can identify states with one and two buried internal water molecules interconnecting parts of the Trp-cage molecule by hydrogen bonds. The loss of hydrogen bonds of these buried water molecules in the folded state with increasing temperature is likely to destabilize the folded state at elevated temperatures.