This report documents results of a two-year effort toward the study and investigation of the design of a prototype system for Chinese-English machine translation in the general area of physics. Previous work in Chinese-English machine translation is reviewed. Grammatical considerations in machine translation are discussed and detailed aspects of the Berkeley grammar II and lexicography are considered. Procedures for interlingual transfer are described in detail. The input and output systems, structure and logic of the syntax analysis system, and auxiliary diagnostic processes are covered as are the means for analyzing processed text. A bibliography is provided along with further details on flow charts, documentation, trees, coding, and sentence generation in the appendixes. (VM)