The ability to transport and manipulate fluids on the scale of hundreds of microns and smaller has triggered a wide range of scientific investigations and technological applications. Microfluidic devices allow handling of small fluid volumes, fast response times, selective addressing of the cellular scale, and they allow for sensing and flow control. There are many recent studies of transport processes in microfluidic devices and networks, including mixing, reactions, separations, etc. In this talk, I will first present a brief survery of transport questions (and some answers) relevant to microfluidics. Second, I will present microfluidic experiments illustrating the controlled formation of liquid drops in a second fluid stream, with particular attention given to the drop size as function of the flow of two fluid phases. Drops with diameters in the tens of micron to submicron range can be formed readily. Methods for manipulating the drop size distribution will be presented also. Wetting properties can be significant in these systems and a discussion of some observations and characteristics will be given.