The book is designed for a junior/senior level course. Applications drive the material: PageRank, Multiplexing, Digital Link, Tracking, Speech Recognition, Route Planning and more. Topics include Markov chains, detection, coding, estimation, Viterbi algorithm, expectation maximization, clustering, compressed sensing, recommender systems, Kalman Filter, Markov decision problems, LQG, and channel capacity. Matlab examples are used to simulate models and to implement the algorithms. Appendices provide the necessary background in basic probability and linear algebra. See https://sites.google.com/site/walrandpeecs/home.