This book presents a development of the frequency-domain approach to the stability study of stationary sets of systems with discontinuous nonlinearities. The treatment is based on the theory of differential inclusions and the second Lyapunov method. Various versions of the Kalman-Yakubovich lemma on solvability of matrix inequalities are presented and discussed in detail. It is shown how the tools developed can be applied to stability investigations of relay control systems, gyroscopic systems, mechanical systems with a Coulomb friction, nonlinear electrical circuits, cellular neural networks, phase-locked loops, and synchronous machines.