The annual report covers the sixth year of full scale operation of the Institute of Library Research. It covers the activities of the Institute including the completion of several projects, the initiation of other projects, and the first full year of the Library Systems Development Program. The major thrust of the Institute during this period has been three-fold: first, to continue to explore and search for a better understanding of how the needs for information can be met through better library service; secondly, to help the libraries of the University of California apply such knowledge to their operational environment; and third, to continue to meet the obligations and operational goals of the Institute during a period of growing financial uncertainty and unfilled management positions. (Author)