This report is intended to assist Canadian libraries in assessing potential library applications of optical disk technology. Part 1 provides a general outline of the technology and describes a number of library applications and projects. Descriptions are purposely general and illustrative in nature since the technology and its applications are developing rapidly. Part 2 is the report of the Canadian National Library's Videodisc Demonstration Project, which took place between 1981 and 1983. The project description provides an in-depth view of the potential of a specific optical disk system type, namely videodisc, to address library storage, preservation, and access concerns. The seven appendices include: (1) commonly used acronyms; (2) personnel involved in the Videodisc Demonstration Project; (3) arrangement of material on the videodisc; (4) indexing of the "O Canada" segment of the videodisc; (5) project equipment and operational features; (6) programming the Apple II for a combined videodisc/microcomputer information retrieval system; and (7) a 33-item reading list. (THC)