Wireless adhoc networks consist of users that want to communicate with each other over a shared wireless medium. The users have transmitting and receiving capabilities but there is no additional infrastructure for assisting communication. This is in contrast to existing wireless systems, cellular networks for example, where communication between wireless users heavily relies on an additional infrastructure of base stations connected with a high-capacity wired backbone. The fact that they are infrastructureless makes wireless adhoc networks inexpensive, easy to build and robust but at the same time technically more challenging. The fundamental challenge is how to deal with interference: many simultaneous transmissions have to be accommodated on the same wireless channel when each of these transmissions constitutes interference for the others, degrading the quality of the communication. The traditional approach to wireless adhoc networks is to organize users so that they relay information for each other in a multi-hop fashion. Such multi-hopping strategies face scalability problems at large system size. As shown by Gupta and Kumar in their seminal work in 2000, the maximal communication rate per user under such strategies scales inversely proportional to the square root of the number of users in the network, hence decreases to zero with increasing system size. This limitation is due to interference that precludes having many simultaneous point-to-point transmissions inside the network. In this thesis, we propose a multiscale hierarchical cooperation architecture for distributed MIMO communication in wireless adhoc networks. This novel architecture removes the interference limitation at least as far as scaling is concerned: we show that the per-user communication rate under this strategy does not degrade significantly even if there are more and more users entering into the network. This is in sharp contrast to the performance achieved by the classical multi-hopping schemes. However, the overall picture is much richer than what can be depicted by a single scheme or a single scaling law formula. Nowadays, wireless adhoc networks are considered for a wide range of practical applications and this translates to having a number of system parameters (e.g., area, power, bandwidth) with large operational range. Different applications lie in different parameter ranges and can therefore exhibit different characteristics. A thorough understanding of wireless adhoc networks can only be obtained by exploring the whole parameter space. Existing scaling law formulations are insufficient for this purpose as they concentrate on very small subsets of the system parameters. We propose a new scaling law formulation for wireless adhoc networks that serves as a mathematical tool to characterize their fundamental operating regimes. For the standard wireless channel model where signals are subject to power path-loss attenuation and random phase changes, we identify four qualitatively different operating regimes in wireless adhoc networks with large number of users. In each of these regimes, we characterize the dependence of the capacity on major system parameters. In particular, we clarify the impact of the power and bandwidth limitations on performance. This is done by deriving upper bounds on the information theoretic capacity of wireless adhoc networks in Chapter 3, and constructing communication schemes that achieve these upper bounds in Chapter 4. Our analysis identifies three engineering quantities that together determine the operating regime of a given wireless network: the short-distance signal-to-noise power ratio (SNRs), the long-distance signal-to-noise power ratio (SNRl) and the power path-loss exponent of the environment. The right communication strategy for a given application is dictated by its operating regime. We show that conventional multi-hopping schemes are optimal when the power path-loss exponent of the environment is larger than 3 and SNRs ≪ 0 dB. Such networks are extremely power-limited. On the other hand, the novel architecture proposed in this thesis, based on hierarchical cooperation and distributed MIMO, is the fundamentally right strategy for wireless networks with SNRl ≫ 0 dB. Such networks experience no power limitation. In the intermediate cases, captured by the remaining two operating regimes, neither multi-hopping nor hierarchical-MIMO achieves optimal performance. We construct new schemes for these regimes that achieve capacity. The proposed characterization of wireless adhoc networks in terms of their fundamental operating regimes, is analogous to the familiar understanding of the two operating regimes of the point-to-point additive white Gaussian noise (AWGN) channel. From an engineering point of view, one of the most important contributions of Shannon's celebrated capacity formula is to identify two qualitatively different operating regimes on this channel. Determined by its signal-to-noise power ratio (SNR), an AWGN channel can be either in a bandwidth-limited (SNR ≫ 0 dB) or a power-limited (SNR ≪ 0 dB) regime. Communication system design for this channel has been primarily driven by the operating regime one is in.