This evaluation used ethnographic data collection methods to discover why IBM's PALS (Principle of the Alphabet Literacy System met with different degrees of success at the two Massachusetts pilot sites after 2 years of operation: the North Central Correctional Institute (NCCI) in Gardner, and the Brightwood Branch Library in Springfield. Three profiles are included in this report: (1) PALS itself; (2) the application of PALS at NCCI (including its limitations, outcomes and future directions); and (3) the application of PALS at Brightwood (including its future directions and a profile of its learner-centered Read/Write/Now program). These profiles describe the teaching philosophies of the host organization and interpret the data collected from the program staff and program materials during a one-day visit to each site. Several months after the two site visits, follow-up telephone interviews were conducted to provide updated information about key PALS features. The conclusions discuss the success or lack of success of PALS both within the program context and as a system for teaching adult literacy. Recommendations to IBM for improving PALS and to the Board of Library Commissioners for future funding and evaluation of the pilot programs conclude the report. Appended materials listed in the table of contents are not included in this document. (3 tables) (MAB)