This booklet examines the emergence of the two Korea's and implications for their unification. By tracing the philosophical development of the nations and shared ideas and values, the booklet attempts to explain policy issues faced by the nations and other world powers in dealing with them. Chapters include: (1) "Legacies from the Past"; (2) "Eclipse by Japan"; (3) "Liberation, Two States and War"; (4) "South Korean Politics"; (5) "North Korean Politics"; (6) "The Two Economies"; and (7) "Korea's Relationship to the World." Monographs in FPA's Headline Series are published approximately four times a year and are intended as a resource for teachers and students in the foreign policy area. Each monograph: is about a world area or topic; is written by a noted scholar; is brief (usually 64 pages); is written to be highly readable; and includes basic background, maps, charts, discussion guides, and suggested reading. (EH)