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During the last decade there has been a renewed interest in the development of advanced, active hand prosthetic devices for amputees. In contrast to passive prostheses, active devices can be controlled by the user's intention. Active prosthetic devices have been substantially improved by integrating robot technology to achieve more functionalities and lifelike movements. Despite important progress in the technological development of prosthetics, their clinical application is still limited by the quantity and quality of biological signals that can be used for understanding the user's intention, and by the relatively poor performance of the algorithms that translate the user's intention into a desired movement. In this review we describe a solution to some of these limitations, i.e., the flexible, multichannel, implantable intraneural and intramuscular electrodes to interface the body's peripheral nerves or muscles. We aim to review the historic development, the underlying technology, and the design concepts of these electrodes. Moreover, the signal processing methods applied to these recordings and their use for the control of prosthetic devices will be discussed. Although the focus is on hand prostheses, the interface approach described is general.