Models which solve the governing groundwater flow or solute transport equations in conjunction with optimization techniques, such as linear and quadratic programing, are powerful aquifer management tools. Groundwater management models fall in two general categories: hydraulics or policy evaluation and water allocation. Groundwater hydraulic management models enable the determination of optimal locations and pumping rates of numerous wells under a variety of restrictions placed upon local drawdown, hydraulic gradients, and water production targets. Groundwater policy evaluation and allocation models can be used to study the influence upon regional groundwater use of institutional policies such as taxes and quotas. Furthermore, fairly complex groundwater-surface water allocation problems can be handled using system decomposition and multilevel optimization. Experience from the few real world applications of groundwater optimization-management techniques is summarized. Classified separately are methods for groundwater quality management aimed at optimal waste disposal in the subsurface. This classification is composed of steady state and transient management models that determine disposal patterns in such a way that water quality is protected at supply locations. Classes of research missing from the literature are groundwater quality management models involving nonlinear constraints, models which join groundwater hydraulic and quality simulations with political-economic management considerations, and management models that include parameter uncertainty.