Cooperative transmission has been recently proposed as a promising technique to combat multi-path fading and increased link reliability. It represents a potential candidate to exploit the benefits of using multiple antennas system without requiring to implement multiple antennas per terminal. There has been extensive research investigating physical layer issues of such systems; however, higher layer protocols that exploit cooperative links in ad hoc networks are still emerging in cooperative ad hoc networks, and it is important to effectively use cooperation without affecting the performance of the network.In this dissertation, we proposed a novel a characterization of the optimal multi-hop cooperative routing in ad hoc networks, and developed a metric for both evaluation. The key advantages of cooperative links are to minimize the number of hops while maintaining the QoS requirements and to minimize the end-to-end total power for a given rate. Also we showed that energy can be used more efficiently if we determine the joint optimal packet size and the optimal power allocation for both the source and the relay.For multi-flow scenario, we have proposed a clique-based inter-flow interference abstraction, and used the linear programming formulation to study the capacity gain of ad-hoc cooperative network. It is observed that the network capacity in multi-hop multi-flow settings is severely affected by interference between links and this effect increases when the cooperative relaying is imposed.