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In underground mine and road tunnels, multipath fading is much more severe than in the terrestrial wireless channels. To overcome the multipath fading in underground tunnels, MIMO (Multiple Input Multiple Output) and Cooperative Communication system can be utilized. Since the underground channel characteristics are significantly different from those in terrestrial environments, the channel capacity and the outage behavior of such systems need to be investigated based on underground tunnel channel models, which had not been addressed by the research community yet. In this paper, the capacity distribution and outage probability of MIMO and cooperative communication systems are investigated in underground tunnel environments. Explicit formulas of the capacity distribution and outage probability are developed as functions of environmental conditions and system configurations. Based on the capacity and outage analysis in underground tunnels, the optimal MIMO antenna geometry design scheme is proposed for MIMO systems; and the cooperative relay assignment protocol is developed for cooperative communication systems. Simulations are conducted to validate the theoretical results.