Historically, urban and suburban interests have dominated educational policy at the national level, but recognition of the need for federal rural education policy is growing. Effective educational policy for rural people, who account for one-third of the U. S. population, must consider the distinctive characteristics of rural areas. Vast cultural differences exist in rural America as well as disparate socioeconomic levels, with rural people (especially rural minorities), generally below the national average. While the urban to rural population turnaround is affecting many rural communities in complex ways, other rural communities continue to lose population. Academic achievement of rural students has begun to reach the national average only recently; the same is true of rural teachers' qualifications and salaries. Financing problems are severe for isolated and sparsely populated school districts, where per pupil costs are necessarily high. Specific issues in developing policy for rural education include the pros and cons of consolidating school districts, involvement of local people in the development of their schools, financing, curriculum and personnel needs, appropriate use of educational technology, and the need for relevant research. Rural education policy, if it is to improve rural schools, must be part of a comprehensive plan for rural development. (JH)