Near-infrared spectroscopy (NIRS) is a noninvasive neuroimaging tool for studying evoked hemodynamic changes within the brain. By this technique, changes in the optical absorption of light are recorded over time and are used to estimate the functionally evoked changes in cerebral oxyhemoglobin and deoxyhemoglobin concentrations that result from local cerebral vascular and oxygen metabolic effects during brain activity. Over the past three decades this technology has continued to grow, and today NIRS studies have found many niche applications in the fields of psychology, physiology, and cerebral pathology. The growing popularity of this technique is in part associated with a lower cost and increased portability of NIRS equipment when compared with other imaging modalities, such as functional magnetic resonance imaging and positron emission tomography. With this increasing number of applications, new techniques for the processing, analysis, and interpretation of NIRS data are continually being developed. We review some of the time-series and functional analysis techniques that are currently used in NIRS studies, we describe the practical implementation of various signal processing techniques for removing physiological, instrumental, and motion-artifact noise from optical data, and we discuss the unique aspects of NIRS analysis in comparison with other brain imaging modalities. These methods are described within the context of the MATLAB-based graphical user interface program, HomER, which we have developed and distributed to facilitate the processing of optical functional brain data.