During the next several years, nearly half of all U.S. principals will retire. Despite principals' crucial leadership role, the methods for training and selecting these administrators are often ill-suited for employing outstanding leaders. Patronage, favoritism, familiarity, or good impressions frequently prevail over merit. This bulletin begins by assessing problems within the principal preparation and selection process. Chapter 1 summarizes recent research and presents four possible explanations for districts' failure to identify, prepare, and hire the most effective principals: (1) insufficient attention to preparation; (2) a limited pool of capable applicants; (3) nonspecific vacancy announcements and selection criteria; and (4) inadequate screening and selection techniques. Chapter 2 examines principal preparation by documenting the experiences of two Oregon districts--Corvallis and David Douglas--with successful programs. Corvallis provides carefully designed internships, and David Douglas' STAR (Selecting and Training Administrative Recruits) program emphasizes practical training sessions for aspiring principals. Chapter 3 features exemplary screening and selection techniques used in Lake Oswego and Tigard school districts (Oregon). The final chapter summarizes effective employment practices and offers recommendations for districts desiring to capitalize on the coming "window of opportunity" presented by retiring principals. Included are 19 references and 11 interview citations. (MLH)