This document is a chapter in "The Principles and Practice of Educational Management," which aims to provide a systematic and analytical introduction to the study of educational management. The structure of the book reflects the main substantive areas of educational leadership and management, and most of the major themes are covered in the volume's 19 chapters, of which this is one. This chapter examines the evaluation of teachers and leaders in schools and colleges. It looks at the two key elements of managing systems--accountability and professional development--and examines the tension between these two systems. If accountability is a key purpose of performance appraisal, then the need to help the performer to develop is crucial. Without that opportunity, performance may remain static. Some of the factors that have been shown to affect performance appraisals are teacher autonomy, the various models of effective teaching, context, the new emphasis on learning, and the issue of rewards. The main question, though, that addresses the management of performance appraisal is as follows: How are national requirements to be managed at the school or college level? In countries where self-management of schools and colleges is well developed, answers to this question are beginning to emerge. However, in any scheme of performance appraisal, certain components are common, such as some form of self-evaluation and observation. Although it is likely that models of learning will develop that may drastically alter the role of the teacher, the teacher's place is certain to remain pivotal in educational institutions. Effective managers will always be aware of the changing environment within which their institutions exist. (Contains 35 references.) (RJM)