Preparation programs for principals should have excellent academic and performance based components. In examining the nature of performance based principal preparation this report finds that school administration programs must bridge the gap between conceptual learning in the classroom and the requirements of professional practice. A number of bridging procedures and their drawbacks are examined and include: (1) simulation materials; (2) instructional materials; (3) group processes; and (4) project courses. Administrative experiences in field settings should constitute a significant portion of performance based preparation programs including: course based activities, practica, and internship. The major objective of such an experience should be to develop problem analysis and judgment abilities in future administrators. A matrix rating procedure for evaluating administrator preparation programs is presented along with data from actual ratings of programs at two universities. Suggestions for ways to improve support and recommendations for preparation program improvement are provided. Included in the report are a glossary of the terms used and a reference list. (MD)