This report provides evidence that the first semester in community college is a pivotal point in students' academic careers. Students whose first academic experience in college is positive and successful are more likely to remain in school, and to sustain their aspiration to transfer to a four-year college. Those whose first experiences are less successful are far less likely to persist towards their goals. The majority of young adult high school graduates who entered community college in fall 1998 aspired to transfer to a four-year college to earn a bachelor's degree, but only a minority of these students made it past the first semester with their goals intact. Of the young adult high school graduates who entered college aspiring to transfer, most either left school after the first semester or lowered their educational expectations. One quarter did not return for the spring semester. Among those who returned, only a slight majority still had transferring to a four-year college as their primary educational goal. Overall, only four in ten returned for the spring semester and maintained their educational aspirations. One in three returned with lowered expectations. Ultimately, only 41.3 percent of this subset of students transferred to a four-year college or university. The report also shows that students who took a full courseload of transfer-eligible courses (four or more) in their first semester were far more likely to transfer than other students, a pattern found for every racial/ethnic group. Similarly, students with high first semester GPAs in transfer-eligible courses were more likely to transfer. (Contains 5 tables and 12 figures.)