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In this paper, we propose a comprehensive solution for power control in mobile ad hoc networks (MANETs). Our solution emphasizes the interplay between the MAC and network layers, whereby the MAC layer indirectly influences the selection of the next-hop by properly adjusting the power of route request packets. This is done while maintaining network connectivity. Channel-gain information obtained mainly from overheard RTS and CTS packets is used to dynamically construct the network topology. Unlike the IEEE 802.11 approach and previously proposed schemes, ours does not use the RTS/CTS packets to silence the neighboring nodes. Instead, collision avoidance information is inserted in the CTS packets and sent over an out-of-band control channel. This information is used to dynamically bound the transmission power of potentially interfering nodes in the vicinity of a receiver. By properly estimating the required transmission power for data packets, our protocol allows for interference-limited simultaneous transmissions to take place in the neighborhood of a receiving node. Simulation results indicate that, compared to the IEEE 802.11 approach, the proposed protocol achieves a significant increase in the channel utilization and end-to-end network throughput and a significant decrease in the total energy consumption.