It is wide spread belief that wireless mobile ad-hoc networks will be a further evolutionary step towards ubiquitous communication and computing. Due to the mobility of the network nodes, the strongly varying radio propagation conditions and the varying data traffic load these networks constitute a very dynamic environment. One essential step in evaluating the true benefit of this new technology consists of estimates and constraints concerning the scalability and performance of such networks. Using a simple model we discuss analytically the effect of interference on the link quality and connectivity of large networks. It turns out that the outage probability rapidly increases with increasing traffic load. Furthermore, we investigate the connectivity of the network under varying traffic load and find a percolation phase transition at a particular value of the traffic load. We discuss the dependence of these effects on parameters characterizing the receiver and the radio propagation conditions.