A survey was conducted to study the interactions between higher education and business in the United Kingdom, updating previous surveys, and capturing the key outputs of such interactions, taking into account the institutions' differing missions, strategies, capacities, and expertise. Additional purposes were to quantify a baseline for the activity that has developed in higher education institutions, to establish and test indicators that might inform decisions on targeted funding for knowledge transfer activities, and to assess the opportunity costs of this kind of survey against the usefulness of the data collected. The population surveyed consisted of 168 institutions (universities established before 1992, those established after 1992, and higher education colleges), and the total response rate was 89%. Information was collected about institutional strategies to support economic development, something about which institutions were very positive. Sponsored and collaborative research continues to grow, reaching about 2 billion British pounds invested in the 1999-2000 academic year. Higher education institutions also reported significant growth in invention disclosures and patents since the previous survey. Many higher education institutions have been formalizing their policies on consulting, attempting to regulate consulting by individuals and encouraging consulting within the academic contract. There has also been a growth in "spin-off" firms in which higher education institutions or their employees have equity stakes. The core activities of providing training remain important areas of interaction with business, and student placements with business continue to be a key means of building employability skills and linking with employers. Higher education institutions also responded that most are involved in some form of economic regeneration activity. In general, the higher education community supported the activities and conduct mentioned in the survey. Findings suggest that institutions need to take a more strategic view of some interactions, and that the government must take into account the varied nature of interactions between higher education and business. The survey questionnaire is attached. (Contains 38 tables, 21 figures, and 18 references.) (SLD)