The Performance Review, Analysis, and Improvement System for Educators (PRAISE) is a formative evaluation instrument designed to improve the performance of school principals. The system appears to be reliable and valid and is flexible enough to accommodate the needs of a variety of schools. Sample items and categories of the instrument include problem solving and decision making; curriculum and program development; relations with teachers; relations to parents and community; and professional qualities and competencies. Selected categories and items of the inventory system for principal performance indicators include setting and achieving goals and objectives; directing and leading; managing change and innovations; and delegating and inviting participation. The inventory system is computerized to facilitate data processing. System features include the identification of strengths and weaknesses; a two-dimensional leadership profile; experiential exercises designed to analyze one's own actions and behavior in an objective manner; summaries for any segment of a population of educators; and training plans that show training needs by priority listings. PRAISE is an evolving system that, when compared to similar appraisal systems, shows great promise. Ten references are cited. (GJ)