Distance education is often hailed as the answer to the worlds problems of educational provision particularly in the developing countries of which African governments are no exception. Distance education has been used for both pre-service and in-service education, and at most levels of education. However, other than the structural differences between the distance education system and the conventional educational system, there is an economic dimension too. Claims are made that distance education can improve the access to, and the quality of, educational provision at a lower unit cost. It is in this vein that a case study was undertaken in order to make a comparative analysis of the financial operations of the two education systems--distance education and conventional education--of Nkrumah College of Education of Kabwe, Zambia. The study captured the views and experiences of respondents and analysed numerical figures. In order to achieve the above stated objectives, the sampled respondents and documents were drawn from the two systems of Nkrumah College of Education. Primary information was gathered from the accounting staff and administrators of Nkrumah College of Education, using a self-designed questionnaire and interview schedule. Secondary information was obtained from documentary analysis of the financial records of Nkrumah College of Education. It was found that the unit cost, i.e. cost per graduate was lower in the distance education system than in the conventional education system. With regard to funding of the two systems, this study established that student fees were the sole source of finances for the distance education system whilst the conventional system was financed by various sources other than student fees: grants from the government, private sector/NGOs, international funding agencies, and from sale of materials and services. The study also established that the government did not fund the distance education system at NCE; rather the distance learners financed the entire operations of the distance education system. Arising from the findings of this study, various recommendations have been made, including the need for the government to offer some funding to the distance education system so that student fees may not be beyond the reach of the neediest for whom the distance education system is mainly intended. (Contains 8 tables and 2 figures.)