How to replace ${} placeholders in a text file?

Sed!

Given template.txt:

The number is ${i}
The word is ${word}

we just have to say:

sed -e "s/\${i}/1/" -e "s/\${word}/dog/" template.txt

Thanks to Jonathan Leffler for the tip to pass multiple -e arguments to the same sed invocation.

Update

Here is a solution from yottatsa on a similar question that only does replacement for variables like $VAR or ${VAR}, and is a brief one-liner

i=32 word=foo envsubst < template.txt

Of course if i and word are in your environment, then it is just

envsubst < template.txt

On my Mac it looks like it was installed as part of gettext and from MacGPG2

Old Answer

Here is an improvement to the solution from mogsie on a similar question, my solution does not require you to escale double quotes, mogsie's does, but his is a one liner!

eval "cat <<EOF
$(<template.txt)
EOF
" 2> /dev/null

The power on these two solutions is that you only get a few types of shell expansions that don't occur normally $((...)), `...`, and $(...), though backslash is an escape character here, but you don't have to worry that the parsing has a bug, and it does multiple lines just fine.

Use /bin/sh. Create a small shell script that sets the variables, and then parse the template using the shell itself. Like so (edit to handle newlines correctly):

File template.txt:

the number is ${i}
the word is ${word}

File script.sh:

#!/bin/sh

#Set variables
i=1
word="dog"

#Read in template one line at the time, and replace variables (more
#natural (and efficient) way, thanks to Jonathan Leffler).
while read line
do
    eval echo "$line"
done < "./template.txt"

Output:

#sh script.sh
the number is 1
the word is dog