Deans of Instruction or Presidents of 94 junior colleges were asked what percentage of their faculty used a non-punitive A, B, C, W (withdraw) grading system, with no failing or F grade. The data shows a growing interest in such grading practices. There are three main arguments in favor of non-punitive grading: (1) an F grade is a double penalty, requiring better-than-average grades to counterbalance it; (2) fear of an F may impair the performance of anxiety-prone students; (3) A-F grading systems discourage experimentation outside of one's major field. Arguments against the non-punitive grading system are that (1) a potential F grade is an incentive to do better work; (2) failure occurs in life and it is unrealistic to exclude it from the academic world; (3) F or D grades that result in students' dismissal open up space for more qualified students. It is felt that this last reason is the most valid. In view of limited educational resources, it is suggested that schools have a dismissal policy based on some number of withdrawal grades. (MS)