General interest in decentralized decision-making in education is increasing in both Canada and the United States. This paper attempts a preliminary study of school-based management, which shifts some budgetary decision-making authority from the central office to individual schools. Although many academic specialties have explored decentralization of public services, there is a dearth of empirical research on school-based management. After exploring theoretical perspectives and research questions, particularly the work of Milton Friedman, Henry Mintzberg, and Herbert Simon, this paper discusses two reasons for decentralization in educational organizations: increased accountability and efficiency. Two Canadian school districts, Edmonton Public Schools (Alberta) and Langley School District (British Columbia) were studied to determine the structure, decision-making flexibility, accountability, and efficiency of school-based management. Results showed both districts to be considerably decentralized organizationally, if not politically. A high level of decision-making flexibility and a fair amount of accountability seem to have been achieved. The greatest impact was on the principal, who enjoys decentralization and is perceived as more powerful. Teacher satisfaction is moderately positive. Efficiency appears to have improved, as evidenced in increased levels of service and higher student and parent satisfaction. Further research is needed to substantiate these results. Included is a bibliography of 46 references. (MLH)