Recent measurements of network tra c have s h o wn that self-similarity is an ubiquitous phenomenon present i n b o t h local area and wide area tra c traces. In previous work, 1 we h a ve s h o wn a simple, robust application layer causal mechanism of tra c self-similarity, namely, the transfer of les in a network system where the le size distributions are heavy-tailed. In this paper, we study the e ect of scale-invariant burstiness on network performance when the functionality of the transport layer and the interaction of tra c sources sharing bounded network resources is incorporated.First, we s h o w that transport layer mechanisms are important factors in translating the application layer causality into link tra c self-similarity. Network performance as captured by throughput, packet loss rate, and packet retransmission rate degrades gradually with increased heavy-tailedness while queueing delay, response time, and fairness deteriorate more drastically. The degree to which h e a vy-tailedness a ects self-similarity is determined by h o w well congestion control is able to shape a source tra c into an on-average constant output stream while conserving information.Second, we s h o w that increasing network resources such as link bandwidth and bu er capacity results in a superlinear improvement in performance. When large le transfers occur with nonnegligible probability, the incremental improvement in throughput achieved for large bu er sizes is accompanied by long queueing delays vis-a-vis the case when the le size distribution is not heavy-tailed. Bu er utilization continues to remain at a high level implying that further improvement in throughput is only achieved at the expense of a disproportionate increase in queueing delay. A similar trade-o relationship exists between queueing delay and packet loss rate, the curvature of the performance curve being highly sensitive to the degree of self-similarity.Third, we i n vestigate the e ect of congestion control on network performance when subject to highly self-similar tra c conditions. We implement an open-loop congestion control using unreliable transport on top of UDP where the data stream is throttled at the source to achieve a xed arrival rate. Decreasing the arrival rate results in a decline in packet loss rate whereas link utilization increases. In the context of reliable communication, we compare the performance of three versions of TCP|Reno, Tahoe, and Vegas|and we nd that sophistication of control leads to improved performance that is preserved even under highly self-similar tra c conditions. The performance gain from Tahoe to Reno is relatively minor while the performance jump from TCP Reno to Vegas is more pronounced consistent with quantitative results reported elsewhere.