This paper analyzes college entrance examinations and graduation rates as indicators of the quality of education and of school systems in the South. The following implications and conclusions are discussed: (1) Scholastic Aptitude Tests (SATS) were designed to measure outcomes for students intending to continue on to higher education and thus are not representative of the entire student body. (2) The percent, characteristics, and resources of those students taking the SATs in each state are influenced by state policies and local practices. Greater expenditures are associated with higher average scores, suggesting that there are returns to investments in education. (3) Policies of state colleges and universities designed to restrict or increase access can also influence the number and composition of students taking the SAT and their aggregate scores. (4) Graduation rates measure only the retention rate of the school, not the quality of education. (5) Raising educational standards may drive some youth out of school, thus lowering graduation rates. (6) The same educational inputs do not necessarily achieve the same outputs because of differences among students. (7) It is difficult to measure actual improvement of districts and states due to the changing standards. (8) Reforms aimed at affecting the outcomes of high school students must be long term, and effects must be traced back through the entire educational system. (CG)