Presented is a pilot study focusing attention on problems of deteriorating physical plants and inadequate/obsolete equipment contributing to the current crisis in engineering education. Data are reported from a survey instrument (included in an appendix) from 26 colleges/universities, representing 168 programs out of a national total of 1212 programs. Information obtained for fiscal years 1970-71 to 1980-81 included: laboratory expenditures; faculty man years; student credit hours produced; degrees awarded; enrollment; number of student stations; separately budgeted research expenditures; base year inventory (1970-71); and laboratory credits required. Review of the data reveals that the average laboratory equipment inventory per school declined from $5,809,000 to $856,000 during the period 1971-81. Based on 250 schools, this leads to the conclusion that the cost of modernizing engineering laboratories (at the 1971 level) will be $1,238,250,000; considering the difference in enrollment between 1981 and 1971, this figure increases to $2,195,417,000. These and other results indicate that the engineering education system is currently stretched to (or beyond) its limit and that the problems of large class size, high student-to-faculty ratios, deteriorating physical plants, inadequate equipment, and inability to acquire laboratory equipment commensurate with present-day technological advances in industry are too widespread to be ignored. (JN)