We analyze a new technique for encoding and decoding of coherent ultrashort light pulses. In particular, we discuss the temporal and statistical behavior of pseudonoise bursts generated by spectral phase coding of ultrashort optical pulses. Our analysis is motivated by recent experiments that demonstrate high resolution spectral phase coding of picosecond and femtosecond pulses and suggest the possibility of ultrahigh speed code-division multiple access (CDMA) communications using this technique. We trace the evolution of coherent ultrashort pulses into low intensity pseudonoise bursts as a function of the degree of phase coding. For random coding we find that the encoded pulse obeys Gaussian statistics and that the intensity probability distribution function is a negative exponential. These results are utilized to analyze the performance of a proposed CDMA optical communications system based upon encoding and decoding of ultrashort light pulses. We derive the bit error rate (BER) as a function of data rate, number of users, and receiver threshold; and we discuss the performance characteristics for a variety of system parameters. We find that performance improves dramatically with increasing code length. Lltrashort light pulse CDMA could provide tens to hundreds of users with asynchronously multiplexed, random access to a common optical channel.