  Observations of annihilation radiation in the Galaxy are briefly reviewed. We
summarize astrophysical mechanisms leading to positron production, and recent
estimates for production rates from nova and supernova nucleosynthesis in the
Galaxy. The physical processes involved in the production of annihilation
radiation in the interstellar medium are described. These include positron
thermalization, charge exchange, radiative recombination, and direct
annihilation. Calculations of 2\gamma and 3\gamma spectra and the positronium
(Ps) fraction due to the annihilation of positrons in media containing H and He
at different temperatures and ionization states are presented. Quenching of Ps
by high temperature plasmas or dust could account for differences between 0.511
MeV and 3\gamma Ps continuum maps. These results are presented in the context
of the potential of INTEGRAL to map sites of annihilation radiation in the
Galaxy. Positron production by compact objects is also considered.
