This paper investigates the powers and limitations of quantum entanglement in the context of cooperative games of incomplete information. We give several examples of such nonlocal games where strategies that make use of entanglement outperform all possible classical strategies. One implication of these examples is that entanglement can profoundly affect the soundness property of two-prover interactive proof systems. We then establish limits on the probability with which strategies making use of entanglement can win restricted types of nonlocal games. These upper bounds may be regarded as generalizations of Tsirelson-type inequalities, which place bounds on the extent to which quantum information can allow for the violation of Bell inequalities. We also investigate the amount of entanglement required by optimal and nearly optimal quantum strategies for some games.