Communication bandwidth and latency reduction techniques are developed for Distributed Interactive Simulation (DIS) protocols. Using logs from vignettes simulated by the OneSAF Testbed Baseline (OTB), a discrete event simulator based on the OMNeT++ modeling environment is developed to analyze the Protocol Data Unit (PDU) traffic over a wireless flying Local Area Network (LAN). Alternative PDU bundling and compression techniques are studied under various metrics including slack time, travel time, queue length, and collision rate. Based on these results, Packet Alloying, a technique for the optimized bundling of packets, is proposed and evaluated. Packet Alloying becomes more active when it is needed most: during negative spikes of transmission slack time. It produces aggregations that preserve the internal PDU format, allowing the resulting packets to be subjectable to further bundling and/or compression by conventional techniques. To optimize the selection of bundle delimitation, three online predictive strategies were developed: Neural-Network based, Always-Wait, and Always-Send. These were compared with three offline strategies defined as Type, Type-Length and Type-Length-Size. Applying Always-Wait to the studied vignette using the wireless links set to 64 Kbps, a reduction in the magnitude of negative slack time from -75 to -9 seconds for the worst spike was achieved, which represents a reduction of 88 %. Similarly, at 64 Kbps, Always-Wait reduced the average satellite queue length from 2,963 to 327 messages for a 89% reduction. From the analysis of negative slack-time spikes it was determined which PDU types are of highest priority. The router and satellite queues in the case study were modified accordingly using a priority-based transmission scheduler. The analysis of total travel times based of PDU types numerically shows the benefit obtained. The contributions of this dissertation include the formalization of a selective PDU bundling scheme, the proposal and study of different predictive algorithms for the next PDU, and priority-based optimization using Head-of-Line (HoL) service. These results demonstrate the validity of packet optimizations for distributed simulation environments and other possible applications such as TCP/IP transmissions.