Using clientr, client, serverr, server vars wisely.

[calani]

I'd make movement clientside with checks done serverside every few ticks.
If I was making a physics engine that kept track of several thousand items and was very important to the server, i'd have all the players do it locally, then do a spot-check every few seconds to make sure everyone's list is accurate.
The server would check each player's list against every other and take the most common one, then send that to everyone as an update. Thus, everyone has the same list every few seconds and the server wouldn't have to do any work actually calculating any of the physics. Also, a majority of the server would have to be hacking in order for it to affect the rest of the server.