In 1989, a study was conducted of the transfer function in California community colleges. The study focused on trends in transfer rates, transfer student characteristics, and the prior academic preparation and post-transfer performance of transfer students. Major findings of the study included the following: (1) of every 12 students enrolled in the California community colleges, four identify transfer as a goal, three of the four take a transfer program, two of the three transfers move to a four-year college, and slightly more than one of the two obtain a bachelor's degree; (2) of every 10 transfers, seven go the California State University (CSU) system, one goes to the University of California (UC) system, one goes to a California private institution, and one goes to an out-of-state institution; (3) the number of transfers to CSU and UC increased by over 8% since 1987; (4) the number of Hispanic transfer students increased during the past decade, Black transfers increased during the past 2 years after 3 years of decline, and American Indian transfers have been relatively constant; (5) the percentage of high school graduates who entered a community college within 3 years of transferring to a UC or CSU campus increased to just over 40% in fall 1988, a 15-year high; (6) the transfer rates of White students are higher than those of other racial and ethnic groups, while those of Black students are lower; (7) the community colleges are enrolling fewer students each year who are eligible to attend UC or CSU; (8) after an initial drop in grades, community college students generally perform as well as students who started as freshmen at UC and CSU; (9) whether transfers or native UC/CSU students, Black and Hispanic students do not perform as well as White and Asian students; (10) the number of potential transfer students in California will probably decrease until 1992, and then increase; and (11) the racial and ethnic makeup of high school graduates will probably include more Asian students and far more Hispanic students in the future. Charts and graphs illustrate the data. (JMC)