Factors that distinguish the United States higher education system and its performance are considered, with attention to new developments, propsects for change, undergraduate education, and professional schools (especially law, business, and medicine). The way universities change the methods and content of their teaching in response to new opportunities and needs in the outside world is explored. Some important changes taking place in higher education are discussed: the increasing use of advanced technology in teaching, the effort to develop better ways of preparing students for public service, and the growing interest in midcareer education for practitioners in many different professions. It is suggested that the competition characteristics of U.S. higher education (competition for the best students, the most advanced scholarship, the most successful scientific research, the best facilities) have helped to produce venturesome, adaptable, and varied universities. In addition to the traditional focus on program and curriculum, greater attention to improving the effectiveness of teaching and learning is emphasized. The debate over the liberal arts curriculum at the undergraduate level is considered. (SW)