This project demonstrates a collaborative process designed to address the continuing preparation of principals who have primary responsibility for supervising and evaluating teachers, and the preparation of cooperating teachers as more effective supervisors of student teachers. The project focuses on one major question: What is the role of collaborative action research in providing public school principals and teachers with support and challenge for both individual and organizational development and improved supervisory practice? The project includes three phases over a 3-year period: (1) five elementary and two middle school principals participated in a Collaborative Leadership Group (along with project staff members, they facilitated the formation of Collaborative Teacher Supervision Groups); (2) both principals and teachers are applying cognitive-developmental theory to current supervisory practices; and (3) the Principal Leadership Group and the Teacher Supervision Groups will match supervisee developmental stages with appropriate models of supervision and will disseminate their findings. The long-range value of this inquiry is three-fold: (1) to generate implications and further questions for the design and implementation of more effective supervision strategies; (2) to enhance teacher effectiveness and student learning through improved supervisory practices; and (3) to contribute to the development of a theoretical base for the practice of instructional supervision. (JD)