Fiber optical parametric amplifiers (OPAs) are nonlinear devices based on the third-order nonlinear susceptibility of glass fibers. They require one or two pumps, located near the fiber zero-dispersion wavelength, and phase matching between the waves must occur. Injecting a signal at the input results in amplified signal and a new wavelength, the idler, emerging from the output. Important features have been demonstrated, including: 60 dB of cw gain; 400 nm gain bandwidth; tunable narrowband gain spectra; noise figure below 4 dB.The presence of the idler can be used for wavelength conversion. The spectrum of the idler is also inverted with respect to that of the signal; thus by placing an OPA in the middle of a fiber span one can realize mid-span spectral inversion (MSSI) which counteracts the effect of fiber dispersion and some nonlinear effects.By modulating the pump one modulates signal and idler at the output. This can be used to implement a variety of signal processing functions, including: demultiplexing of TDM signals; retiming and reshaping functions (2R regeneration).Some challenges must be overcome for fiber OPAs to be useful in communication applications. In WDM systems, these are: four-wave mixing and cross-phase modulation between signals; cross-gain modulation. Fiber OPAs also exhibit conversion of pump RIN and/or FM (used to suppress SBS) to signal and idler IM.Fiber OPAs will benefit from design and fabrication of novel fibers with high nonlinearity and improved dispersion properties. Novel families of fibers, such as holey fibers, are promising in this respect.