Cooperation among network nodes provides transmit diversity in cases where wireless transmitters, due to size and power limitation, cannot support multiple antennas. We consider cooperation among M nodes, where each node achieves space diversity by using other nodes' antennas as relays. Cooperation among nodes has been shown to achieve impressive bit error rate (BER) gains as compared to a non-cooperative system while maintaining the same information rate, transmit power, and bandwidth [ A. Sendonaris et al. (2003), J. N. Laneman et al. (2004), T. E. Hunter et al.]. Firstly, this paper formulates an optimum, centralised power allocation scheme appropriate for a cooperative network that employs transparent relaying. It will be shown that the proposed allocation scheme significantly outperforms the equal power allocation scheme, e.g., by up to 5 dB for a 3-user case at a bit error rate of 10/sup -3/. Secondly, this paper proposes a distributed power allocation scheme where each node independently calculates its power allocation factors, and it will be shown that it converges to the optimum allocation yielded by the centralised approach. Finally, this paper presents a distributed power allocation algorithm to optimise the BER performance of cooperative networks only with partial knowledge of the channel state information (CSI) of the non-adjacent nodes.