Motivated by the recent works on the relay channel and cooperative diversity, this letter introduces coded cooperation, where cooperation is achieved through channel coding methods instead of a direct relay or repetition. Each codeword is partitioned into two subsets that are transmitted from the user's and partner's antennas, respectively. Coded cooperation achieves impressive gains compared to a non-cooperative system while maintaining the same information rate, transmit power, and bandwidth. We develop bounds on BER and FER and illustrate the advantage of coded cooperation under a number of different scenarios.