The development of Tennessee's Master Teacher Program is described in this case study, the first in a series of project reports. Data were derived from interviews, document analysis, transcriptions and analyses of meetings, informal conversations, questionnaires, and monitoring of legislative sessions and committee hearings. Following an introduction, the state's 1983 Master Teacher Plan and Career Ladder Program are described. Chapter 3 describes the inception and presentation of the plan. Chapters 4 and 5 examine early responses to the plan and public and legislative reactions after deferral. Key groups in program formation are identified in the sixth chapter, and the seventh chapter offers an analysis of news coverage that may have fostered public misconceptions. The final chapter discusses the program's status and issues at the end of 1983. Two tables are included. Appendices include: information about the Senate Joint Resolution 96 Study Committee and actions of the governor's office; an annotated resource directory; information on the Teachers' Study Council; the newspaper sample; the Comprehensive Education Reform Act of 1984; and a list of 29 merit pay references. (LMI)