Legislation in 1998 provided enrollment funding for UNC distance education. This report documents the growth of UNC distance education programs and their role in meeting the high priority education and economic development needs of the State. As highlighted in the Executive Summary and documented throughout this report, state enrollment funding for UNC off-campus and distance education degree-credit instruction is achieving its intended effect of expanding access to higher education for North Carolina citizens unable to relocate or travel to a UNC campus and reducing the demand on limited on-campus enrollment capacity. The enrollment funding has enabled UNC campuses to make crucial investments in faculty training, staff support, and information technology that are needed to offer high-quality instruction in a rapidly evolving and expanding distance education environment. Instructional quality is paramount in developing these distance education opportunities, and policies and assessment procedures are in place to assure this. Costs of instruction are monitored carefully, and ongoing attention is being given to developing cost-effective programs through efficient use of information technology and collaboration and coordination among UNC campuses. UNC distance education programs are planned with the goal of raising the educational attainment level of North Carolinians and thus improving their economic and social well being. Careful needs assessments are conducted before programs are developed, and programs authorized are those that would be most beneficial for the economic growth and vitality of North Carolina communities. Consultation with other state partners (e.g., the North Carolina Community College System, public school systems, Area Health Education Centers [AHEC], and professional associations) in planning and delivering quality distance education programs is a high priority.