An automatic channel selection (ACS) process enables an access point to determine a best channel available, i.e., the channel with a least amount of interference, for it operation. When ACS is enabled, the access point scans frequencies for all neighboring access points and their signal strengths. Based on this data, the access point then determines which frequency is least likely to be interfered with by these other access points. The access point switches itself to this frequency and begins operation. During normal operation, the access point may periodically rescan the air space and reevaluate its current operating channel. Preferably, every neighboring access point has its own channel, and the co-channel interference levels should be low enough so that there is a maximum coverage and high throughput for the network. If these characteristics cannot be achieved, the access point may then adjust its power automatically to reduce the interference level in the network. This automatic power adjustment (APA) feature preferably operates across a set of access points, each of which has the function. In this manner, the transmitting power of the neighboring access points in the wireless network is “cooperatively” adjusted to minimize the channel interference and maximize the coverage and throughput for the network. A method of determining optimal access point locations for access points that perform the ACS and APA functions is also described.