High school graduation rates are conspicuous indicators of the relative successes of education systems, school districts, and high school campuses. Graduation rates are among the academic excellence indicators that will be used for the accreditation of school districts by the Texas Education Agency. This report discusses how high school graduation rates are calculated, what data are excluded from these calculations, and how these calculations can be improved. It examines data related to calculating graduation rates collected by the Texas Education Agency's Public Education Information Management System. The report recommends calculating a graduation rate by following a cohort of first-time ninth-grade students for a period of 6 years, including in the calculation student mobility, grade retention, and graduation from alternative education sites. Seven figures and 5 tables present data on Texas high school graduates, and there is a 14-item list of references. (Author/SLD)