The geometrical theory of nonlinear differential equations originates from classical works by S. Lie and A. Bäcklund. It obtained a new impulse in the sixties when the complete integrability of the Korteweg-de Vries equation was found and it became clear that some basic and quite general geometrical and algebraic structures govern this property of integrability. Nowadays the geometrical and algebraic approach to partial differential equations constitutes a special branch of modern mathematics. In 1993, a workshop on algebra and geometry of differential equations took place at the University of Twente (The Netherlands), where the state-of-the-art of the main problems was fixed. This book contains a collection of invited lectures presented at this workshop. The material presented is of interest to those who work in pure and applied mathematics and especially in mathematical physics.