Hey, I'm having a bit of trouble when it comes to creating encounters for my PCs. I have a 4-man party and they are all Jedi armed with lightsabers except for one who wanted to go unarmed. They've pretty much cut through everything I've thrown at them so far which indicates I need to up the challenge a bit. But I'm not sure how to do that in regards to the use of rivals and nemesis. How many nemesis should be used in an encounter?

At least two against one, or with very good passive talents like Defensive Stance and Dodge. 2 vs 1 is good for the conflict of targeting, while you can still hit one the other will have a good shot at hitting and surviving a round. Setback and Difficulty Upgrade are also good for survivability.

But if you really want a challenge, its big minion groups that come at Long range. 6 or more minions is a lot of dice, and not all PCs could cover that distance in an action.

Set pieces and environmental effects also help to control the scene, in pace and in enemy having an edge.

Also, pay attention to the equipment you are giving to the enemies. A grenade is a lot harder to deal with than a blaster bolt. A group of minions in a skiff or air speeder peppering blaster fire down on your lightsaber wielding PCs is going to be a different kind of fight than everyone starting on the ground.

A bunch of minions pinning the PCs down while a Rival or Nemesis sniper attempts to down them from long or extreme range could be a good change, especially if the sniper has a jet pack and can escape before the group can close to laser sword range.

The challenge shouldn't be about the stats. Make the PCs think and engage in a dynamic, cinematic battle.

You could do a few things:

As noted above, make the battle a little more cinematic, don't have the minions rush in head long against your group and engage in what amounts to a boxing match ... there is no reason a contingent of Troopers can't duck behind cover, call in reinforcements, sneak around and flank the group, etc. And if your minion groups, Rivals and Nemesis come from different areas (or attack in different ways), it may make the players split up a bit to take them on. You could also create environmental hazards that affect the PC's, either natural such as rain or man-made such as a chemical or smoke grenade that has the PC's taking strain or wounds each round, adding setback dice, upgrading the difficulty of the attacks, and so forth.

You might consider using the instructions to make an Inquisitor or two, or go through the books and pull out some of the Rival and Nemesis to battle against ... when the battle starts, use them accordingly (you can mix and match characters and their stats to suit your story). Sometimes it can be fun and challenging to let the Rivals and particularly Nemesis get 2 initiative slots each round to simulate their advanced skills/experience in taking on multiple opponents. Then use the destiny to pool with them to upgrade their attacks or defense.

Also, when the PC's are engaged with a Nemesis and possibly have him close to defeat ... have another minion group come in a later round to get their attention: "Finally, you have the Inquisitor fatigued and weakening, this battle will soon be over and you can finally be free of his constant pursuit, but as your lightsaber clashes against his, even though the crackle rings in your ears, 2 blaster bolts go whizzing by you and hit the wall off to your right sending mud and brick exploding into the air. Seems the Inquisitor's backup have arrived, their blasters are drawn and they are taking positions not far from you. As you turn to see what you may be up against, the Inquisitor slips around the corner and disappears into the alley, seems you will meet again, when -- you don't know, but for now, that blaster fire needs to be taken care of ....... " [Of course, if your story arc needs him to be defeated here, have him fight on. Whatever the case may be ... narrating a deep story can help make these battles come alive and can help make them easier or more challenging as needed]