This paper analyzes, theoretically and by computer simulation, the capabilities and limitations of neural networks to be used for the identification and optimal control of nonlinear dynamical systems. It is shown how neural networks can be efficiently trained to identify the forward and inverse dynamics of systems and also to work as optimal controllers which minimize some peformance measures of the system to be controlled. The performance of neural networks when applied to the optimal control of nonlinear vehicle suspensions is analyzed and compared with the performance of passive suspensions and that of active suspensions with linear (LQ) controllers designed by linearizing the nonlinear characteristics of the suspensions around the equilibrium point. It is found that nonlinear vehicle suspensions with neuro-control show better performance than suspensions controlled with conventional LQ regulators. Some issues about the implementation of neural networks to improve its convergence and generalization properties are analyzed. © 1994, The Japan Society of Mechanical Engineers. All rights reserved.