In this dissertation, we seek to improve collision avoidance for autonomous underwater vehicles (AUVs). More specifically, we consider the case of a small AUV using a forward-looking sonar system with a limited number of beams. We describe a high-fidelity sonar model and simulation environment that was developed to aid in the design of the sonar system. The simulator achieves real-time visualization through ray tracing and approximation, and can be used to assess sonar design choices, such as beam pattern and beam location, and to evaluate obstacle detection algorithms. We analyze the benefit of using a few beams instead of a single beam for a low-cost obstacle avoidance sonar for small AUVs. Single-beam systems are small and low-cost, while multi-beam sonar systems are more expensive and complex, often incorporating hundreds of beams. We want to quantify the improvement in obstacle avoidance performance of adding a few beams to a single-beam system. Furthermore, we developed a collision avoidance strategy specifically designed for the novel sonar system. The collision avoidance strategy is based on posterior expected loss, and explicitly couples obstacle detection, collision avoidance, and planning. We demonstrate the strategy with field trials using the 690 AUV, built by the Center for Marine Autonomy and Robotics at Virginia Tech, with a prototype forward-looking sonar comprising of nine beams. / Doctor of Philosophy / This dissertation focuses on improving collision avoidance capabilities for small autonomous underwater vehicles (AUVs). Specifically, we are looking at the scenario of an AUV equipped with a forward-looking sonar system using only a few beams to detect obstacles in our environment. We develop a sophisticated sonar model and simulation environment to facilitate the design of the sonar system. Our simulator enables real-time visualization, offering insights into sonar design aspects. It also serves as a tool for evaluating obstacle detection algorithms. The research investigates the advantages of utilizing multiple beams compared to a single-beam system for a cost-effective obstacle avoidance solution for small AUVs. Single-beam sonar systems are small and affordable, while multi-beam sonar systems are more complex and expensive. The aim is to quantify the improvement in obstacle avoidance performance when adding additional sonar beams. Additionally, a collision avoidance strategy tailored to the novel sonar system is developed. This strategy, developed using a statistical model, integrates obstacle detection, collision avoidance, and planning. The effectiveness of the strategy is demonstrated through field trials using the 690 AUV, constructed by the Center for Marine Autonomy and Robotics at Virginia Tech, equipped with a prototype forward-looking sonar using nine beams.