Small schools (with enrollments of 300 or less) are being rediscovered as models for effective schools. Currently 26.9% of America's school systems enroll over 500,000 students in more than 26,000 small schools staffed by 50,000 teachers. Small schools have pioneered many educational "innovations": non-graded classrooms, individualized instruction, cross-age groupings, peer tutoring, and emphasis on the basics. Current efforts to reduce student/teacher ratios, use the community as a resource, and "mainstream" mildly handicapped pupils also have their roots in the small schools of the past. Small schools offer benefits in areas of personal relationships, student morale, teacher-student interaction, administration, and curriculum and instruction. Although research on optimum school size is mixed, research suggests that class size is related to pupil achievement, smaller classes are more conducive to improved pupil performance, smaller classes provide more opportunities to meet individual needs, pupils in small classes have more interest in learning, and teacher morale is higher in smaller classes. Strengths inherent in small schools that support characteristics/practices associated with findings from "effective schools' research" include orderly, serious, safe, attractive school climate, clear school mission; strong administrative leaders who emphasize instruction; high expectations for student achievement; presence of student, staff, and school evaluation systems; supportive home/school relations. (NEC)