In 1981, Save the Children (SC) opened an office in Nepal to support projects related to health, education, income generation, and resource management. Statistics show that between 7 and 8 million of Nepal's 19 million people live below the poverty line, and almost 2 out of 3 adolescent girls do not attend school, placing the overall female literacy rate at only 18%. In recognition of economic and educational needs, SC organized a community-based, nonformal education program to promote literacy and community organization in a rural area of the country. SC enlisted community participation by requiring each literacy group to: (1) pay for books, registration, and a partially subsidized tuition; (2) construct a shelter for the school; and (3) select a facilitator from the community. The program adapted literacy course content to issues and economic needs in the community. Program participants have expressed an increased sense of power; mobilized for community development activities; decreased smoking; and begun sending more of their young children, including girls, to school. The program has been effective in assisting women in particular, and the literacy rate for the program area has risen from 42% in 1989 to 54% in 1992. The initial literacy programs have given rise to other initiatives, including the organization of women's groups and income-generating collectives, the transformation of women's social roles, and the development of a home-based, rotating child care system. (AC)