This report compares Minnesota's reading and mathematics performance on the most recent administrations of the state assessment with performance on the National Assessment of Educational Progress (NAEP). To indicate how Minnesota is doing in narrowing the academic achievement gap between African American, Latino, or low-income students and their white, middle class peers, the report presents NAEP data by race, ethnicity, and family income. The report presents other state-level data on K-college education, including demographic distribution across each educational level, participation and success in Advanced Placement, percentage of students taking high-level courses, school funding gaps, and high school and college graduation rates. In 2002, 64 percent of all 5th graders performed at the basic level or above in reading on the state assessment. On the 1998 NAEP 4th grade reading assessment, 69 percent of Minnesota students performed at the basic level, while 36 percent performed at or above the proficiency level. Significantly more whites than blacks were proficient or above in reading. In 2002, 74 percent of all 8th graders passed the state mathematics assessment.On the 2000 NAEP 8th grade mathematics assessment, 40 percent of Minnesota students were at or above the proficient level. Significantly more white than black 8th graders passed the state standards test. Minnesota had the fourth largest African American-white NAEP 4th grade reading achievement gap in 1998 and the seventh largest Latino-white 8th grade NAEP mathematics achievement gap in 2000. African American students are underrepresented in Advanced Placement (AP) exam taking, underrepresented in gifted and talented programs, and overrepresented in special education. Over 40 percent of Minnesota high school students enroll in college, compared to 54 percent nationwide. Asian American students graduate from the state college at a significantly higher rate than students from other groups. About 1 in 14 Minnesota secondary classes are taught by teachers lacking a major or minor in the field. Districts with higher child poverty rates and higher minority enrollments have more state and local dollars to spend per student than those with lower poverty rates and lower minority enrollments. (SM)