This dissertation considers a 2x2 wireless communication system employing coherent dual-polarized (DP) antennas. The DP signaling is shown to outperform co-polarized signaling through ergodic capacity analysis under Rician channel with large Rician K factor and signal-to-noise ratio (SNR). Fundamental properties and applications of DP signaling that involves modulating polarization state are addressed emphasizing constellation design, coded modulation implementation, peak-to-average power ratio (PAPR) reduction phase code construction, and DP testbed validation.Firstly, polarization shift keying (PolSK) constellations are analyzed in AWGN and Rayleigh channels. Maximum likelihood (ML) detectors are proposed to exploit non-Gaussian statistics of noise on the Poincar\'e sphere given channel information at receiver. Furthermore, coherent DP antennas enable a four dimensional (4D) signal space. 4D hybrid constellations are designed as a product of amplitude/phase states and polarization states. With constant symbol power, phase shift keying (PSK) is combined with PolSK to yield PSK+PolSK that achieves larger minimum Euclidean distance and higher capacity against PSK+PSK. Relaxing power constraint, quadrature amplitude modulation (QAM) and amplitude phase shift keying (APSK) are adopted with PolSK to obtain QAM+PolSK and APSK+PolSK. The capacity superiority against QAM+QAM and APSK+APSK is displayed at practical rates. For non-coherent detection, differential PSK (DPSK) is combined with PolSK to produce DPSK+PolSK. It not only avoids phase alignment at receiver but also outperforms DPSK+DPSK with/without carrier frequency offset and symbol time offset effects.Secondly, bit-interleaved coded modulation with iterative demapping and decoding is implemented to exploit capacity advantage of 4D hybrid constellations, e.g., 8PSK+8PolSK-cube and 16QAM+16PolSK. Both recursive systematic convolutional (RSC) code and low-density parity-check (LDPC) code are considered. Given code structure and channel SNR, bit mapping solely determines bit-wise mutual information (BWMI) evolution between soft demapper and soft decoder and thus the coded bit error rate. The evolution of BWMI is tracked by extrinsic information transfer (EXIT) chart. Utilizing binary switch algorithm with BWMI under perfect a priori as the cost function, quasi anti-Gray mappings for RSC coded and quasi Gray mappings for LDPC coded 4D hybrid signaling are both obtained with EXIT analysis. Thirdly, PAPR reduction phase codes, transparent to receiver processing, are proposed for PolSK/DPSK+PolSK modulated OFDM signals based on selective mapping. Min-max absolute phase code and min-max reference phase code are constructed respectively for PolSK and DPSK+PolSK modulated OFDM signals to reduce PAPRs on both DP branches. PAPR reduction capability, symbol error rate, minimum total degradation, and optimal input power back-off are analyzed to validate code's effectiveness with simulated solid-state high-power amplifiers (HPAs). Last but not least, an over-the-air DP testbed based on universal software radio peripherals (USRPs) is established to effect coherent 4D hybrid signaling. Both quasi AWGN and multipath fading scenarios are considered. Over-the-air experiments are conducted to validate the principles and performance trends of proposed ML detectors, 4D hybrid constellations (both coherent and non-coherent), and PAPR reduction phase codes with external HPAs under an OFDM framework.