Carbon nanotubes can be functionalized via amidation and esterification of the nanotube-bound carboxylic acids. The solubility of these functionalized carbon nanotubes makes it possible to characterize and study the properties of carbon nanotubes using solution-based techniques. Representative results concerning the solubility, dispersion, defunctionalization, and optical properties of the functionalized carbon nanotubes are presented. Several examples for the use of functionalized carbon nanotubes in the fabrication of polymeric carbon nanocomposites, the probing of nanotube-molecule interactions, and the conjugation with biological species are highlighted and discussed.