Error diffusion is a popular technique for digital halftoning. The purpose of this paper is to illustrate the versatility of error diffusion with applications beyond halftoning and to show its connections to interesting mathematical questions. We present some recent developments in the theory and application of error diffusion and related algorithms. In particular, we illustrate the stability of error diffusion and present applications in a variety of areas besides image halftoning including scheduling, image processing, image watermarking and displays.