This study investigated the need for distance learning in Pennsylvania's rural schools, examined types of distance learning programs and technology currently being used, and identified factors that could enhance or inhibit the use of distance learning in rural schools. Data collection included (1) a literature search, (2) surveys administered to rural school districts and urban/suburban school districts, (3) review of appropriate chapters in the Pennsylvania School Code, (4) analysis of 5-year plans that rural school districts submitted to the Pennsylvania Department of Education (PDE) and distance learning request for proposals issued by PDE, and (5) interviews with heads of state agencies in Pennsylvania and departments of education in 28 states. Satellite, cable, and public television are the major distance learning technologies being used, and SERC is the major satellite provider. While 112 responses indicate participation in some form of district learning, the majority of these use programs in foreign languages and higher mathematics. However, 340 responses indicate needs for participation in higher mathematics, foreign languages, the sciences, gifted education, advanced placement, elementary programs, and various other programs. Based on a minimum of 3 students per response, at least 1,020 rural students are being denied participation in distance learning. The state School Code does not recognize distance learning as such but does not prevent its implementation. Rural administrators, however, feel that a mandate requiring certified teachers as classroom facilitators prevents their participation. Administrators also indicate needs for financial aid, teacher and administrator training, technical assistance, and facility renovations. Contains 66 references, recommendations, and a glossary. Sixteen appendices to the final report include the following: (1) 37 additional recommendations in planning, funding, legislative, educational, programmatic, and evaluative areas; (2) a tabular summary of the 5-year distance learning plans of rural districts; (3) results of rural and urban-suburban surveys of school district practices and needs in distance education; (4) rural and urban survey instruments; (5) results of analysis of Chapters 3, 5, 6, and 49 of the Pennsylvania School Code to determine their impact on distance learning in rural school districts; (6) text of the above Chapters; (7) a statement on distance learning by the state Senate Education Committee; (8) commonly asked questions about distance learning in Pennsylvania; (9) guidelines and instructions for school districts submitting long-range plans as part of the Pennsylvania Strategic Planning Program; (10) lists of respondents to interim study data, state agency personnel interviewed, participants in the survey of other states' practices, and organizations contacted for position papers on distance learning; (11) an instrument to assess educational opportunities and identify needs in distance education; and (12) request for school district applications for distance learning funding. (Author/SV)