Chapter 4 of a volume on school leadership, this chapter is a revised version of the issue of "School Management Digest" entitled "School Based Management." It draws from the work of many authorities to define, explain, and make a case for school-based management, a system of educational administration in which the school is the primary unit of decision-making. The author begins by examining in detail the school-based management concept. He relates the rationale underlying decentralized management to the criticisms of centralization on which it is based. Examples of successful school-based management are described in Florida and California and in the school districts of Lansing (Michigan), Edmonton (Alberta), and Cherry Creek (Colorado). The key role of the principal as the true leader of the school is discussed, along with the complementary role of the central office in supporting and evaluating the schools. It is noted that the school board still sets goals and policies and makes final decisions. The school site's control over curriculum, personnel, and budget matters is examined, followed by a review of the increased roles of the staff and community in the decision-making process. The author concludes that the rewards of autonomy and feelings of ownership are well worth the extra time and efforts spent on school-based management. (Author/JM)