The status of advanced nonlinear optical materials is reviewed with regard to the requirements implied by their respective applications. Although many functions utilizing nonlinear optical (NLO) materials have been demonstrated in research laboratories, only a few components have found a place in real systems. While this is partly due to a lack of product development effort, the performance of the materials is not adequate in other cases. III–V based semiconductors show promise for a broad penetration of the field of signal processing for telecommunications and data processing. Linear and nonlinear optical polymers may be applied in assembly and interconnection and in small to medium sized switching matrices. As a prerequisite the anticipated performance has to be achieved, and stability to be demonstrated. Manufacturing maturity is approached by inorganic ferroelectrics, LINbO3 being the most prominent example.