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The problem of propagation and interaction of optical radiation in dielectric waveguides is cast in the coupled-mode formalism. This approach is useful for treating problems involving energy exchange between modes. A derivation of the general theory is followed by application to the specific cases of electrooptic modulation, photoelastic and magnetooptic modulation, and optical filtering. Also treated are nonlinear optical applications such as second-harmonic generation in thin films and phase matching.