Nonlinear flutter of flat and slightly curved panels in high supersonic flow is investigated based on a von Karman plate model for the structure and on linear piston theory for aerodynamics. A finite element formulation of adaptive structures with piezoelectric material layers is developed using classical laminate theory. Sensor equations are derived for sell-sensing piezoactuators. The paper briefly discusses linear and nonlinear flutter analysis techniques. Dynamic feedback control is used to suppress flutter of adaptive panels. Linear observer-based state feedback is shown to fail in the face of structural nonlinearity and flight parameter variations. Therefore, a novel control approach using output feedback from a pair of collocated or self-sensing piezoactuators is proposed. This new control methodology based on active compensation of aerodynamic stiffness terms is investigated regarding robustness and design limits.