X-ray studies have established that low-mass stars exhibit their highest levels of magnetic activity during their pre-main sequence phases when planet formation occurs. Our understanding of this activity, and particularly violent magnetic reconnection flares, has been greatly advanced by recent studies such as the Chandra Orion Ultradeep Project (COUP). COUP spectroscopy provides two lines of evidence that X-rays efficiently illuminate and ionize the protoplanetary disks. Recent infrared studies support this. X-ray irradiation may have dramatically affect disk gases: induction of MHD turbulence via the MRI instability with subsequent suppression of protoplanetary migration, heating and ionization of disk outer layers, catalysis of nonequilibrium chemistry, and so forth. Flare effects on disk solids may address long-standing meteoritic issues such as the production of short-lived radionuclides and the flash melting of chondrules.