We first review the evidence for IR activity in interacting and merging galaxies, based on 10 and 20 µm observations. We then investigate the ‘starbursts vs. monsters’ explanations for the energy source powering the IR activity in these galaxies. Using available IR photometry, and IR, optical, and ultraviolet spectroscopy, we show that, in general, a starburst induced by the interaction is by far the most plausible mechanism. We then apply simple starburst models to the IR data to derive some of the quantitative features of these starbursts. Finally, we argue that interaction-induced starbursts are likely to have occurred in the evolution of most galaxies, and we discuss some of the larger implications of this fact for extragalactic astrophysics.