The State Council of Higher Education for Virginia (SCHEV) is required by statute to prepare plans under which the state-supported institutions of higher education shall constitute a coordinating system. To do so, SCHEV must first assess the current state of the system and make predictions about its future. This needs assessment evaluates, for the period from 2001-2010, the demand for, and supply of, higher education services in the Commonwealth and potential gaps between the two. The report documents four major findings from a variety of sources: (1) Virginia will experience a significant increase in higher education enrollment demand between 2001 and 2010; (2) the state's inventory of current and authorized higher education facilities is inadequate to absorb the anticipated increase in enrollment demand between 2001 and 2010; (3) attendance rates at four-year colleges and universities tend to be lower in Southwest Virginia and the Southern Piedmont than they are in the rest of the Commonwealth; and (4) there may be significant gaps between the number of college graduates Virginia produces each year and the number it requires in two key areas: information technology and teaching. The Council will use this information as the basis for the development of a statewide strategic plan for higher education. (SLD)