The authors review the nonlinear:optical properties of semiconductor quantu
m wells that are grown inside high-e Bragg-mirror microcavities. Light-matt
er coupling in this system is particularly pronounced, leading in the Linea
r regime to a polaritonic mixing of the excitonic quantum well resonance an
d the single longitudinal cavity mode. The resulting normal-mode splitting
of the optical resonance is observed in reflection, transmission, and lumin
escence experiments. In the nonlinear regime the strong light-matter coupli
ng influences the excitation-dependent bleaching of the normal-mode resonan
ces for nonresonant excitation, leads to transient saturation and normal-mo
de oscillations for resonant pulsed excitation and is responsible for the d
ensity-dependent signatures in the luminescence characteristics. These and
many more experimental observations are summarized and explained in this re
view using a microscopic theory for the Coulomb interacting electron-hole s
ystem in the quantum well that is nonperturbatively coupled to the cavity l
ight field. [S0034-6861(99)01005-3].