Data from a variety of sources were used to examine the status of charter schools in California. Home to 415 charter schools enrolling 157,000 students, about 2.4% of all public school students in the state, California is at the forefront of the charter school movement, with the number of charter schools increasing rapidly. The average overall performance of charter schools remains lower than that of conventional public schools, but three recent studies demonstrated striking progress as measured by analyses of the California Academic Performance Index. Charter schools are doing a better job than other public schools at improving academic performance of at-risk students, and the academic performance gap between traditional schools and charter schools is closing. These outcomes have been attained despite serious financing inequities, suggesting that charter schools may actually be more productive than many traditional public schools. There is also evidence that charter schools are accomplishing important nonacademic goals that include high parent satisfaction and high student retention. Charter schools in California continue to face obstacles, and the state needs to take some steps to ensure that the state "catches the wave" of charter-led innovation and improvement. The state legislature should end the near monopoly of districts on charter authorizing and oversight, and the supply of charter schools should be expanded. Educational leaders should create more effective means of sharing successes and innovations, and laws and regulations should be more carefully targeted so as not to inhibit creation of new charters. Charter districts should be created with large numbers of schools operating on performance contracts served by a central office serving as portfolio manager rather than owner/operator. (Contains 95 endnotes.) (SLD)