This report by the U.S. Department of Education highlights the benefits of the Class-Size Reduction program that was passed by Congress in 1998. Prior to this federal program, more than 85 percent of students were in classes with over 18 children. However, 1 year after its inception, the program enabled 1.7 million young children to learn in smaller, more personalized, classrooms. The program allowed schools to hire approximately 29,000 new teachers, and as a direct result, 61,000 additional teachers saw their class sizes shrink. Class-Size Reduction funds helped create more manageable classrooms so that teachers could focus on teaching and learning and spend less time on discipline. The program has turned around low-performing schools, has improved reading achievement, and has boosted individualized instruction and classroom management. The report discusses how federal dollars are sent to where they have the greatest impact, and it offers several anecdotes from teachers who testify to the benefits of the program. It describes ways to support state efforts at class-size reduction and offers specific examples of state programs that have benefited children. The text details research that supports the efficacy of class-size reduction, and explains how such program work and why they are cost effective. (RJM)