The purpose of this study was to determine the uses and usefulness of prison literacy and vocational education programs to the 65,000 inmates of federal prisons. Data were collected in two ways: (1) a survey of prison staff and review of selected inmate case files and other data to determine if the Federal Bureau of Prisons (BOP) had reliable overall information on inmate participation in these programs; and (2) a survey of federal prisoners and prison staff on incentives for encouraging inmate participation and on the usefulness of BOP's vocational training and industry work assignments in providing marketable skills. Some of the results of the study were the following: (1) staff comments and review of documents showed that the BOP's Education Data System was not very accurate--although it could provide information on overall trends, it often contained erroneous data on individual prisoner's participation in and completion of education programs; (2) inmates reported that they were more inclined to participate in programs when they saw clear opportunities to improve their capabilities and postrelease success, whereas staff usually considered prisoners to be motivated more by current incentives involving cash awards and other tangible benefits for participation; (3) staff and inmates favored some incentives that BOP could arrange, such as security classification reductions, preferred housing assignments, attending school during the workday rather than during free time, and being paid the starting wage for inmate work for attending class; (4) more than half the inmates thought their vocational training would be useful in providing them with marketable skills, and one-third thought their prison jobs would be helpful; and (5) exprisoners who participated in employment and vocational education programs in prison had a better chance of maintaining employment and earning slightly more money than similar ex-prisoners who had not participated in the programs. The report recommends that the BOP explore ways to broaden the incentives for participating in training programs. (KC)