There is significant and growing interest in teacher pay reform as a number of states and localities have begun experimenting with departures from the single salary schedule--a pay system employed in most school districts, which links teacher pay solely to degree and experience level (Chait, 2007; Goldhaber, 2009; Podgursky and Springer, 2007). Denver's Professional Compensation System for Teachers (ProComp) represents what is arguably the nation's most high-profile example of strategic pay reform. ProComp's origins date back to 1999 when Denver Public Schools (DPS), with the local teachers union's cooperation, initiated a pilot program meant to increase student achievement and attract and retain highly effective teachers. The program gained support as a pilot, and in 2004, union members ratified a proposal for a more comprehensive program which became ProComp. In order to assess whether ProComp has succeeded in increasing student achievement, the authors explore three primary questions: (1) Is there a ProComp "system effect"? Is student achievement higher in years after the implementation of ProComp?; (2) How effective are teachers who choose to opt in to ProComp, compared to teachers who choose not to opt in?; and (3) How does the allocation of rewards in the ProComp system correspond to teacher effectiveness? The authors' findings document significant student learning gains in DPS across grades and subjects. The source of those gains, however, are not altogether clear as there is not a consistent pattern across grade level and subject: in some cases the gains appear primarily amongst students with ProComp teachers, while in other cases non-ProComp teachers are found to be more effective. Though puzzling, these findings are not inconsistent with research on other well-known interventions that include elements similar to ProComp. Two other results that have potentially far-reaching policy implications are clearer. The first is that "ProComp effects" are not always concentrated solely amongst teachers enrolled in ProComp. The second is that some of the ProComp awards do successfully target teacher effectiveness. However, several of the ProComp bonuses appear unrelated to either current or future teacher value-added measurements. Whether this is good or bad is clearly a normative question as some might argue that these awards are rewarding aspects of classroom instruction not strongly associated with students' test achievement. (Contains 5 figures, 6 tables, and 56 footnotes.)