Stability and performance are the two conflicting goals in control of force reflecting robotic systems, such as haptic interfaces and bilateral teleoperation systems. Both the uncertainty attributed to inclusion of a human user in the control loop, and stringent robust stability requirements typically result in very conservative performance. Furthermore, time-varying delays inherent in commercial communication lines compound the already difficult nonlinear control problem of stabilizing bilateral teleoperation systems, and subsequently affect performance. In the first part of this thesis, factors affecting the range of achievable performance in haptic interfaces are analyzed, and accurate real-time velocity estimation from position encoder data is identified as a limiting factor. The efficacy of Levant's differentiator as a velocity estimator, to allow passive implementation of higher stiffness virtual walls, as compared to some of the commonly used velocity estimators in the field of haptics, is studied. A novel performance descriptor, combining passivity and fidelity of haptic rendering, is proposed and used to compare the haptic device performance obtained with Levant's differentiator, to other methods using simulations and experiments. In the second part of this thesis, the effect of time-varying delays on the stability and performance of bilateral teleoperation systems is considered. A framework for increasing performance in Time Domain Passivity Approach (TDPA) based bilateral teleoperation is developed, while preserving robust stability characteristics against time-varying communication delays and remote environment conditions. Several performance compensation schemes are developed within the proposed framework that ensure position tracking between master and slave robot trajectories, and improve force reflection during hard contact interactions. The proposed performance compensation schemes are compared experimentally for their effectiveness in position tracking and force reflection capabilities. In addition, a feedback passivity control based scheme to achieve position synchronization in bilateral teleoperation with power-based TDPA is developed and implemented in simulations and experiments. The proposed method encodes position information with velocity to construct a composite signal, which is transmitted across the communication channel to attain position tracking. Results demonstrate robust position tracking performance with the proposed approach under variable communication delays and remote environment conditions. Combined, these analyses, simulations, and experiments extend the limits of performance in haptic interfaces and bilateral teleoperation systems, while preserving robust stability characteristics.