Asymmetric digital subscriber line (ADSL) is a broadband access technology capable of delivering large bandwidth over existing copper telephone line infrastructure. This research aims at characterizing and analyzing TCP/IP performance in presence of a new protocol stack (TCP/IP over PPP and ATM) being promoted for one of the ADSL network architectures. Using extensive simulations, we verify the adverse effects of asymmetric links on the performance of TCP and additional throughput degradation caused by the overhead at the AAL5- ATM layers. This study involves unidirectional as well as bi-directional data transfer using different traffic mixes including bursty and non-bursty types of traffic. Bi-directional data transfer over asymmetric links results in ACK compression wherein TCP acknowledgements (ACKs) get bunched together behind larger data packets, further exacerbating the effect of asymmetry on TCP performance. By implementing the simulation model for PPP encapsulation over AAL5, we characterize its effect in terms of throughput degradation and excessive delay. We quantify the improvement in the throughput obtained by delaying the TCP ACKs and by TCP/IP header compression. These techniques being effective for unidirectional traffic over asymmetric links, however, do not prove as effective when ATM enters the scenario or in presence of bi-directional data transfer. Further, we implemented a simulation model of the Smart ACK Dropper (SAD), a technique to regulate the flow of TCP ACKs. Considerable improvement in performance especially in the presence of unidirectional data transfer is achieved using the SAD technique. Although the improvement is to a lesser extent in the presence of bi-directional data traffic, SAD helps the network in quickly recovering from the impact of ACK compression. We also propose and implement certain customized queuing/scheduling and policing mechanisms to enable differentiated servicing of TCP ACKs and data packets, and mitigate the effect of ACK compression. While providing considerable TCP performance improvement in presence of SAD, custom queuing also allows fair sharing of bandwidth between TCP flows, unlike priority queuing, which starves the low priority flow. The committed access rate (CAR)policing scheme provides considerable performance improvement when used with SAD, and is especially useful when TCP ACKs compete with bursty data traffic over the slower upstream. / Master of Science