We study the problem of classifying all Poisson-Lie structures on the group
G(infinity) of formal diffeomorphisms of the real line R-1 which leave the
origin fixed, as well as the extended group of diffeomorphisms G(0 infinit
y)superset of G(infinity) whose action on R-1 does not necessarily fix the
origin. A complete local classification of all Poisson-Lie structures on th
e groups G(infinity) and G(0 infinity) is given. This includes a classifica
tion of all Lie-bialgebra structures on the Lie algebra G(infinity) of G(in
finity), which we prove to be all of the coboundary type, and a classificat
ion of all Lie-bialgebra structures on the Lie algebra G(0 infinity) (the W
itt algebra) of G(0 infinity) which also turned out to be all of the coboun
dary type. A large class of Poisson structures on the space V-lambda become
s a homogeneous Poisson space under the action of the Poisson-Lie group G(i
nfinity). We construct a series of quantum semigroups whose quasiclassical
limits are finite-dimensional Poisson-Lie quotient groups of G(infinity) an
d G(0 infinity). (C) 1999 American Institute of Physics. [S0022- 2488(99)00
201-7].