Recent work on the thermal and electrical challenges in realizing AlGaN/GaN microwave heterojunction field effect transistors grown on SiC substrates is discussed. Raman thermography has been used to directly measure the self-heating induced lattice temperature rise with dramatically improved resolution and accuracy compared to traditional infrared techniques. It is demonstrated that defects in the SiC substrate can influence the temperature distribution within the active device with potential consequences for reliability. Microwave devices require an insulating GaN substrate material for device isolation. It is shown that the net deep level acceptor concentration has to be accurately controlled to suppress short-channel effects and to achieve radio frequency power efficient operation.