The study used data from the National Assessment of Educational Progress report to examine the relationship for young adults between functional literacy skills and educational attainment. Educational attainment was classified into four categories: less than a high school graduate, high school graduate, some postsecondary education, and college graduate. On the average, dropouts had lower literacy skills than high school graduates. There was a large increase in literacy skills for college graduates compared with high school graduates. Comparison of educational attainment and race/ethnicity showed that the literacy skills of Blacks and Hispanics were lower than those of Whites within each educational level. Additional analysis of literacy skills was done for White young adults by further subdividing some of the groupings. (The sample of Blacks and Hispanics was too small to permit further breakdown.) The literacy skills of high school equivalency certificate recipients were similar to those of high school graduates on two of three scales, but lower on the third scale. Among young adults completing at least two years of college, those currently enrolled in school had higher literacy skills than those not enrolled. The literacy scores of college students completing two or more years and currently enrolled were equivalent to the scores of graduates of four-year colleges. (YLB)