Gustavo Scuseria of Rice University is supported by the Theoretical and Computational Chemistry program for research on the development and application of novel exchange-correlation functionals for improving accuracy in ground-and excited-state density functional theory (DFT). He is developing functionals for improving accuracy in calculations of excited states of molecules and solids, as well as devising new approximations for time-dependent current-density functional theory. Applications to carbon nanotube problems of practical relevance, molecular electronics and excited states of large molecules of biological interest are being made. In terms of broader impacts, the methods being developed in this project will significantly enhance the current capabilities of the scientific community to model and study molecules and materials with more accurate electronic structure tools. The research is having a considerable impact on many areas where quantum molecular modeling is routinely employed, including the chemical, pharmaceutical, and defense industries, where new materials and chemical processes are routinely studied. In particular, the projects to be pursued include new concepts like local hybrids, the use of screened Coulomb potentials, the inclusion of the current density in functionals, and novel approximations to the calculation of excited states. The application projects center on carbon nanotubes, which promise substantial improvement of thermal and electrical conductivity in advanced materials.