The tobacco industry has employed Negroes since its inception in Colonial Virginia. This study is primarily concerned with the course of Negro employment and industry racial policies in the industry processing, manufacturing, selling, and distributing of cigarettes and manufactured tobacco, as distinct from the cigar industry which involves quite different processes. The tobacco industry has had the longest continuous record of factory employment of Negroes in the United States and is principally concentrated today in the states of Kentucky, North Carolina, and Virginia. The racial policies of this industry may be analyzed over a long period of time for such factors as the Southern location, new products and technologies, and union attitudes. The characteristics of the industry, Negro employment from the Colonial period to 1960, and the attempts to end segregation in the 1960's are examined. Although the racial-occupational segregation pattern in the tobacco industry has been broken, industry sales are not increasing and automation is continuing to affect jobs. Thus new opportunities for Negroes may not result in substantial change because of declining labor demand. (MF)