I am curently working on the modeling and understanding of nanofluids. Nanofluids are colloidal suspensions, i.e. a fine dispersion of nano-sized solid particles in a liquid. Before the advent of nanotechnology the study of colloidal suspensions with micro-sized particles was quite common, but their size posed significant corrosion and erosion hazards in engineering applications. When the manufacture of nano-sized particles became possible, it was noticed that, unlike micron-sized particles, nano-suspensions can form stable systems with very little settling under static conditions. Recently-conducted experiments have indicated that nanofluids tend to have substantially higher coefficients of thermal conductivity than the base fluids. This is both surprising and significant, and is the reason why the study of the transport properties of nanofluids is important. However, the scientific literature on nanofluids is sporadic and full of discrepancies, and a physical explanation for the thermal transport enhancement usually observed in nanofluids is still lacking. The novelty of this work is in a fundamental, realistic, and comprehensive approach to the problem of understanding nanofluids through the use of molecular dynamics simulations with accurate potentials to effectively model realistic materials. Specifically, this study treats the case of a gold-water nanofluid at different particle volume fractions between 1%-vol and 15%-vol. In order to understand more fundamental physical phenomena at the gold-water interface, water confined between gold nanolayers will also be analyzed at different plate separations. Simulations make use of the Quantum Sutton-Chen (QSC) potential for Au-Au interactions, the Extended Simple Point-Charge (SPC/E) forcefield for water-water, and a modified Spohr potential for Au-water interactions. These potentials ensure that most of the physics is captured properly. Thermodynamics and transport properties have been studied for all systems. It is interesting to note that while the thermodynamic properties of the mixture have been commonly predicted using ideal mixture theory, such predictions are found to be generally poor for nanofluids. Our results of computed properties indicate that values are between 10% and 400% off from ideal mixture predictions. The anisotropy induced by the gold-water interface, and its effects appear to be responsible for the disagreement. Transport properties, in particular shear viscosity, and thermal conductivity, are computed using novel equilibrium methods. Specifically, the present work adopts hybrid formulations that exploit the benefits of both Einstein and Green-Kubo classic relations, while avoiding the limitations of each. Transport properties are generally enhanced, and appear not to follow the predictions of classic theories. There is a large number of applications that can benefit from a better understanding of nanofluids. The motivation behind this specific study is the possible use of modern green liquids for the suspension. One example is ionic liquids, which are salts that are liquid at room temperature. However, ionic liquids do not have a very high thermal conductivity, and if that could be improved by the addition of nano-particles, the liquid would be better suited for heat transfer applications such as in absorption refrigeration or cooling circuits. The low toxicity, long lifetime, and antimicrobial properties of such a coolant would make it suitable for use in spacecrafts, perhaps, to increase the efficiency, lower the weight, and reduce the complexity of space thermal control systems. In an extreme environment, such as space, where the thermal control system is exposed to low temperature environments, the enhancement of the thermal conductivity of low freezing point coolants would also improve the overall performance of the thermal control system itself. Liquid cooling with high thermal conductivity fluids would also address many other heat dissipation problems. For instance, micro-electromechanical systems (MEMS) generate large quantities of heat during operation and would require high performance coolants to mitigate the large heat flux. Such a system requires a precise temperature control, and a high conductive fluid in this case would allow for a more efficient heat transfer control. I would like to thank my advisor, Dr. Samuel Paolucci, without whom this work would not have been possible. A special gratitude is also due to Dr. Mihir Sen, for his advices and our precious discussions. My work was funded by the United States Department of Energy, grant number DE-FG02-05CH11294. This research used resources of the National Energy Research Scientific Computing Center, which is supported by the Office of Science of the U.S. Department of Energy under Contract No. DE-AC02- 05CH11231. I also acknowledge the Center for Research Computing and the Center for Applied Mathematics at the University of Notre Dame. Special thanks are also due to Drs. Daniel Gezelter and Charles Vardeman II for their support with the molecular dynamics package OpenMD. University of Notre Dame - AME60630 - Microparticle Dynamics - Fall 2010