The explosion of knowledge and the growing complexity of modern life are changing expectations for what young people need to learn and be able to do. Success in the 21st century does not depend solely on what people know, but also on what they can do with what they know. In this report, the authors summarize the results of a quantitative analysis that identifies districts in which students of color, as well as their White peers, have demonstrated extraordinary levels of academic achievement, measured by California's new assessments in English language arts and mathematics, taking into account race and family income and education levels. These results show, for the first time, which California districts and communities appear to have best supported the academic achievement of students in the first 3 years of the new assessments, controlling for the socioeconomic status of families in each district. The authors also examine some of the factors associated with their success. They find that, aside from socioeconomic status, a major predictor of student achievement is the preparedness of teachers. The proportion of teachers holding less than a full credential (i.e., an intern credential, temporary or short-term permit, or waiver for their teaching position) shows a strong negative association with student achievement for all student groups. In addition, teachers' average experience levels are positively associated with achievement for African American and Hispanic students. The authors recognize that these teacher qualifications are also associated with other variables that influence staff recruitment and retention and may signal broader differentials in teaching and learning conditions. California districts that have been able to find and keep fully prepared teachers have supported stronger student achievement for African American and Hispanic students as well as for White students. The analysis proceeds in two parts. In the first part, the authors identify the California districts that have been particularly successful at supporting the achievement of African American, Hispanic, and White students. The second part of the analysis examines the factors that predict student achievement for African American, Hispanic, and White students at the district level. [For the research brief "California's Positive Outliers: Districts Beating the Odds. Research Brief. Positive Outliers Series," see ED610888.]