This study, authorized by the General Assembly of North Carolina, investigated current indicators of the state of youth physical fitness and the availability and utilization of programs to improve fitness. The study gathered testimony from physical fitness experts, educators, administrators, and medical personnel. The study found that youth are in extremely poor physical condition, and that North Carolina children in several grades exhibit higher levels of body fat, lower flexibility, and less aerobic conditioning than the national average. Recommendations for the General Assembly and the Department of Public Instruction call for daily, quality physical education and fitness experiences for all children; a grant program that would develop model healthful living programs; integration of healthful living into the end-of-grade testing program; and analysis of the professional development of healthful living teachers. Appendixes, which comprise more than half the document, contain: relevant portions of the authorizing legislation, membership of the legislative research commission, statistical data on physical fitness, excerpts from North Carolina's healthful living curriculum, the philosophy section of the Alamance County physical education program, a summary of a study titled "Youth Physical Activity and Fitness and the Impact on North Carolina Industry," and an executive summary of the North Carolina Children and Youth Fitness Study. Much of the data in the appendixes is presented in bargraphs. (JDD)