The purpose of this study was to carry out the mandate of the Education of the Handicapped Amendments of 1983 and 1986 which called for an analysis and evaluation of the effectiveness of procedures undertaken by state education agencies, local education agencies, and intermediate educational units to improve programs of instruction for handicapped children and youth in day or residential facilities. The facilities on which the study focused are those described as "separate"; i.e., residential or day facilities exclusively serving handicapped persons in buildings physically separate from those for their nonhandicapped peers. Research questions specifically addressed were: (1) What are the current number and characteristics of such facilities? (2) What types of educational opportunities and related services do children in these facilities receive? (3) What have been the patterns of change in these facilities? and (4) What factors have affected the practices of facilities and patterns of change? A survey was conducted of 2,580 facilities, from which total 1,941 replies were received for a response rate of 75%. Additionally, data were gathered from 50 special education divisions of state education agencies, including the District of Columbia (one state failed to respond); and case studies were conducted of eight state education agencies and of three facilities within each state. An extended summary of findings, which comprises the remainder of this volume, is organized into three sections: (1) a national profile of separate facilities; (2) a review of state special education procedures that can influence separate facilities; and (3) an analysis of changes at separate facilities since the passage of Public Law 94-142 and the factors associated with those changes. Findings show that separate facilities have noted such changes as increased individualized program planning and evaluation, increased parental involvement, and to some extent, more opportunities for interaction with nonhandicapped peers. Changes in social expectations about the developmental potential and life contributions of handicapped persons have led to increased emphasis on life skills training, vocational training, and transition planning. State education agency procedures have played a significant role in fostering change at separate facilities, especially through setting regulatory standards, offering technical assistance, and monitoring compliance. Several avenues for further resarch are suggested. Includes 23 references. (JDD)