For 2 decades, the U.S. Agency for International Development (USAID) has sought to strengthen Nepal's formal and nonformal education systems and elevate the status of women in Nepal. The extent to which USAID women's empowerment and literacy activities have contributed to increasing and improving the basic education of girls in Nepal was examined through structured interviews with 95 women. Some of the women had completed classes in basic literacy, legal literacy, and/or economic participation; others (the controls) did not complete a USAID program. Education statistics and the school records of the women's children were also examined. The USAID literacy and income generation programs were found to have helped raise the quality of rural and impoverished Nepalese women's lives in many ways. The lessons learned from the study were as follows: development of skills and knowledge among mothers can translate into higher levels of educational attainment among children; the magnitude of the impact of literacy and microenterprise activities on children's education varies by socioeconomic and cultural context; increased earnings by mothers do not necessarily or immediately translate into more education for their daughters; and maternal support for education stimulated by program participation translates into private and social savings. (MN)