Abstract. We give a group theoretic definition of "local models" as sought after in the theory of Shimura varieties. These are projective schemes over the integers of a p-adic local field that are expected to model the singularities of integral models of Shimura varieties with parahoric level structure. Our local models are certain mixed characteristic degenerations of Grassmannian varieties; they are obtained by extending constructions of Beilinson, Drinfeld, Gaitsgory and the second-named author to mixed characteristics and to the case of general (tamely ramified) reductive groups. We study the singularities of local models and hence also of the corresponding integral models of Shimura varieties. In particular, we study the monodromy (inertia) action and show a commutativity property for the sheaves of nearby cycles. As a result, we prove a conjecture of Kottwitz which asserts that the semi-simple trace of Frobenius on the nearby cycles gives a function which is central in the parahoric Hecke algebra.

We develop a theory of affine flag varieties and of their Schubert varieties for reductive groups over a Laurent power series local field k((t)) with k a perfect field. This can be viewed as a generalization of the theory of affine flag varieties for loop groups to a "twisted case"; a consequence of our results is that our construction also includes the flag varieties for Kac-Moody Lie algebras of affine type. We also give a coherence conjecture on the dimensions of the spaces of global sections of the natural ample line bundles on the partial flag varieties attached to a fixed group over k((t)) and some applications to local models of Shimura varieties.

After the work of Kisin, there is a good theory of canonical integral models of Shimura varieties of Hodge type at primes of good reduction. The first part of this paper develops a theory of Hodge type Rapoport-Zink formal schemes, which uniformize certain formal completions of such integral models. In the second part, the general theory is applied to the special case of Shimura varieties associated with groups of spinor similitudes, and the reduced scheme underlying the Rapoport-Zink space is determined explicitly.

For a prime p > 2, we construct integral models over p for Shimura varieties with parahoric level structure, attached to Shimura data (G, X) of abelian type, such that G splits over a tamely ramified extension of Qp. The local structure of these integral models is related to certain "local models", which are defined group theoretically. Under some additional assumptions, we show that these integral models satisfy a conjecture of Kottwitz which gives an explicit description for the trace of Frobenius action on their sheaf of nearby cycles. Bruhat-Tits, a connected smooth group scheme G • over Z p

We study the reduction of certain PEL Shimura varieties with parahoric level structure at primes p at which the group that defines the Shimura variety ramifies. We describe "good" p-adic integral models of these Shimura varieties and study theiŕ etale local structure. In particular, we exhibit a stratification of their (singular) special fibers and give a partial calculation of the sheaf of nearby cycles.