Understanding stress relaxation in heteroepitaxial semiconductors is important if we want to be able to control surface morphology and dislocation density. Because the relaxation process is a complex interaction of many kinetic processes, it is useful to be able to monitor the evolution of the stress and surface morphology in real time. We have developed several optical diagnostics that can be used during growth without interrupting the growth process. Stress relaxation is monitored by measuring the curvature induced in the substrate by the strained film. The technique is robust and has been used in a number of processing environments including MBE, MOCVD and sputter deposition. Examples of stress relaxation due to islanding and dislocation motion will be presented. Spectroscopic light scattering is used to measure the power spectral density of the surface height distribution without having to rotate the sample or detector. This has enabled us to measure the density of strain-relieving islands in heteroepitaxial layers and to understand the effect of elastic interactions between islands on their shape and alignment.