The structure of a number of GaN/AlGaN devices and their associated material growth and processing issues are examined in some detail, and extrapolations are made to predict what the advantages and challenges would accrue for similar AlGaN electrical and optical devices. For RF HEMTs, it is likely that the advantages of the larger breakdown voltage (V (B)) in an Al (Y) Ga1-Y N/Al (X) Ga1-X N AlGaN channel HEMT would be outweighed by the disadvantages of the lower frequency of operation created by the smaller channel mobility when compared to AlGaAs/GaAs HEMTs. The same thing can be said for lateral high-power electronic HEMTs because AlGaN/GaN HEMTs with GaN channels can now be fabricated with V (B) similar to 2,000 V, which is thought to be the upper voltage limit for them, even when the device structures are grown on Si substrates with its accompanying high dislocation density and bow. However, theory suggests that using Al (Y) Ga1-Y N/Al (X) Ga1-X N structures in vertical transistors and AlGaN P-N diodes could enable pulsed power applications such as electric armor because they should be able to handle an order of magnitude more power due to their ten times larger breakdown field in similar to 80 % Al AlGaN, and the Si donor is still relatively shallow at this Al concentration. The major challenges to achieving these goals are to be able to controllably dope the AlGaN in the mid 10(15) cm(-3) range, create an AlGaN current blocking layer beneath the Al (Y) Ga1-Y N/Al (X) Ga1-X N channel that contains an aperture to the drain, confine most of the mismatch dislocations in the AlGaN layers to near the interface with the GaN or AlN substrate that is parallel to the (0001) plane, and fabricate ohmic contacts to the AlGaN with a specific contact resistance < 10(-2) a"broken vertical bar cm(2). Theoretically, the latter can be achieved using polarization doping. For applications to optical device structures, reducing the threading dislocation density in AlN layers on sapphire substrates by high temperature epitaxy is a key parameter for achieving AlGaN-based light emitters with a high efficiency. Stress control and prevention of relaxation is important for obtaining AlGaN layers with a similar dislocation density as the underlying AlN template. A dislocation density below 5 x 10(8) cm(-2) is sufficient for obtaining an efficiency of radiative recombination of 40 % and higher at moderate excitation levels.