Abstract. In this study we have used dynamical characteristies such as Lyapunov exponents, nonlinear dynamic models and mutual information for the nonlinear analysis of the magnetospheric AE index time series. Similarly with the geometrical characteristic studied in Pavlos et al. (1999b), we have found significant differences between the original time series and its surrogate data. These results also suggest the rejection of the null hypothesis that the AE index belongs to the family of stochastic linear signals undergoing a static nonlinear distortion. Finally, we believe that these results support the hypothesis of nonlinearity and chaos for the magnetospheric dynamics.