The ways that the Tennessee Higher Education Commission (THEC) has sought to recognize the contribution of private higher education in Tennessee are addressed. Specific involvement of the private sector was provided in the preparation of the 1979-84 THEC Master Plan. Many of the planning issues identified in that plan touched on private sector concerns and interaction with public sector institutions. The master plan describes the governance and organizational structures in the state with a specific reference to the interaction of THEC with private sector institutions. The plan supplies data profiles and recent trends in such areas as enrollments, programs, faculty, finance, and facilities, and private sector institutions are represented in most of these trends. Additionally, the role of the private sector is specifically recognized in the statement of goals and objectives. Among the more important policy statements affecting the private sector is the issue of potential merger between private institutions and public institutions. The state provides financial support for private sector institutions through student financial aid, contract programs of the Southern Regional Education Board, and direct contracts. The THEC is charged by legislative statute to consider the programs and facilities of private higher education as it assesses the needs of the state in higher education. Policy and planning are designed to accord private education full recognition in the community of higher education in the state and to maintain full respect for the independence and autonomy of private higher education. A bibliography is appended. (SW)