The Computational Mechanics thrust area is a vital and growing facet of the Mechanical Engineering Department at Lawrence Livermore National Laboratory (LLNL). This work supports the development of computational analysis tools in the areas of structural mechanics and heat transfer. Over 75 analysts depend on thrust area-supported software running on a variety of computing platforms to meet the demands of LLNL programs. Interactions with the Department of Defense (DOD) High Performance Computing and Modernization Program and the Defense Special Weapons Agency are of special importance as they support our ParaDyn project in its development of new parallel capabilities for DYNA3D. Working with DOD customers has been invaluable to driving this technology in directions mutually beneficial to the Department of Energy. Other projects associated with the Computational Mechanics thrust area include work with the Partnership for a New Generation Vehicle (PNGV) for ''Springback Predictability'' and with the Federal Aviation Administration (FAA) for the ''Development of Methodologies for Evaluating Containment and Mitigation of Uncontained Engine Debris.'' In this report for FY-97, there are five articles detailing three code development activities and two projects that synthesized new code capabilities with new analytic research in damage/failure and biomechanics. The article this year are: (1) Energy- and Momentum-Conserving Rigid-Body Contact for NIKE3D and DYNA3D; (2) Computational Modeling of Prosthetics: A New Approach to Implant Design; (3) Characterization of Laser-Induced Mechanical Failure Damage of Optical Components; (4) Parallel Algorithm Research for Solid Mechanics Applications Using Finite Element Analysis; and (5) An Accurate One-Step Elasto-Plasticity Algorithm for Shell Elements in DYNA3D.