This thesis presents two-dimensional hydrodynamic disk simulations with embedded protoplanets, emphasizing the non-linear dynamics in the co-orbital region. In particular, it demonstrates how a protoplanetary disk responds to embedded low mass planets at the inviscid limit. Since the potential vorticity (PV) flow is not conserved, due to the spiral shocks and possibly boundary layer effects emanating from the planet, the PV profile develops inflection points which eventually render the flow unstable. Vortices are produced in association with the potential vorticity minima. Born in the separatrix region, these vortices experience close encounters with the planet, consequently exerting strong torques on the planet. The existence of these vortices, if confirmed, have important implications on planetary migration rates. The formation of vortices is discussed in more detail and a key parameter is found which depends solely on planet mass and sound speed. With this key parameter, one can predict the disk evolution, PV growth rates, and threshold conditions for forming vortices in the co-orbital region. An analytical estimate for the change of PV due to shocks is compared to the actual change in PV in the hydrodynamic simulations. They match well except in the inner region where vortices form. In addition, extensive resolution tests were carried out but uncertainties remain about the physics of this particular region.