This document provides a detailed assessment of the opportunities and challenges facing university-industry research collaborations. This report represents a synthesis of the work and findings of this initiative. It analyzes several of the critical issues facing research collaborations between industry and universities and offers suggestions to make these collaborations more effective. The Bayh-Dole Act of 1980 was passed to improve the transfer of university research to private companies capable of translating advances into new products and services for consumers. Research collaborations can offer direct benefits for university and company participants, but there are several barriers to collaboration, including practical considerations and the conflict of values. Of the many ingredients in successful negotiations between companies and universities, mutual trust is perhaps the most important. In addition, a balance must be found between the need of university researchers to share their findings and the need of companies to protect the value of their investments through confidentiality. Indirect costs are yet another issue that companies and universities must resolve. Appendixes list panel participants from the study of collaboration and provide tables of university research expenditures and licensing income tables. (SLD)