This is an evaluation of the first 2 years of a 5-year comprehensive Bilingual Education grant funded by Title VII Part A of the Improving America's Schools Act of 1994 in the Austin Independent School District (AISD) (Texas). The grant awarded to the AISD funds a program of Developmental Bilingual Education at two elementary schools where more than 25% of the students are of limited English proficiency (LEP). Developmental Bilingual Education requires dual language instruction throughout the duration of the program. This is in contrast to a transitional program in which instruction is gradually changed to English-only. At the same time, Developmental Bilingual students must master subject matter skills and meet grade promotion requirements. Baseline data were collected on the 600 students at the 2 schools who will receive 4 years of developmental bilingual teaching, but all 967 students at the 2 schools participate. Baseline scores for the two schools indicated that 56% of students were fluent English speakers, with 17% not speaking English, and 72% not speaking Spanish. Third graders in 1996-97, in comparison with 1995-96 third graders, showed a 10% gain in the numbers of students passing on all of the English Texas Assessment of Academic Skills tests. Prekindergarten and kindergarten students in the second year also showed considerable gains in Spanish vocabulary in 1996-97. Evaluation also revealed the extensive preparation of the teachers at both schools and the investment in curriculum and technology to improve education. Parent participation was shown to be an integral part of the program at both schools. Recommendations are made for continued program improvement with better communication between the two schools and better use of student testing in evaluation. (Contains 12 tables, 1 figure, and 12 references.) (SLD)