Salary and compensation of faculty in Illinois public colleges and universities were studied using a cluster analytic approach. Twenty-seven institutional variables were factor analyzed to obtain a smaller set of closely related variables. Factor scores were obtained for each of the 1,126 institutions of higher education. A cluster analysis was then conducted to explore potential groupings of institutions based on similar factor scores patterns. A multiple group discriminant analysis was also conducted to refine the groups identified through cluster analysis and to determine the most significant factors in discriminating among clusters. The salary and compensation analyses For 1974 through 1979 were then conducted as follows: cluster mean, median, quartile range, quartile placement, minimum entry in cluster, maximum entry in cluster, and minimum-maximum range. The analysis was conducted for each academic rank and for all ranks combined. This analysis was conducted twice: first with raw data for salary and compensation and then with the salary and compensation data adjusted for cost of living. The variables were selected that were descriptive of the nature and comprehensiveness of the institution's academic programs, the size of the institution, the research emphasis of the institution, the status of faculty, and the selectivity of student admissions. Five factors were found to account for approximately 75 percent of the total variance: size and comprehensiveness, graduate program emphasis, undergraduate selectivity, master's emphasis, and faculty workload. Illinois institutions were generally found to receive lower salary and compensation than did institutions with similar characteristics in other states and the Illinois' levels declined in relative standing between 1974-75 and 1979-80. The 12 Illinois public institutions were classified into eight separate clusters, which are appended. (SW)