From the concern over the poor educational performance of school children nationwide has evolved the question of setting higher standards via testing. This paper focuses on the state's responsibility to require performance standards for children. Topics discussed include general issues related to the testing controversy, recent state efforts to use testing to reform the educational system, policy issues related to minimal standards, and legal responsibilities of institutions that impose standards on students. The paper concludes that, ultimately, an institution must be able to demonstrate that every effort has been made to provide children with the opportunity to learn. Several tables provide information on the actions of individual states in setting educational standards. (Author/LD)