The Association of American Universities (AAU) calls on the Administration, Congress, and academia, with the help of the business sector, to implement a 21st Century National Defense Education and Innovation Initiative aimed at meeting the economic and security challenges we will face over the next half-century. Government and America's universities and colleges should implement this initiative now, so that it can be fully in place by 2008--the 50th anniversary of the National Defense Education Act (NDEA) of 1958. The Initiative springs from a belief among AAU universities that the burden of meeting these challenges is not government's alone and that research universities and higher education have key roles to play. It therefore calls for action and resources--and change-- not only from government but also from the nation's colleges and universities. It also reflects a strong belief that, if we take the right actions, America can maintain its global leadership and that we can ensure our national and economic security for the 21st Century. The objectives of the Initiative are threefold: (1) Enhance America's research capacity in order to sustain scientific and technical innovation; (2) Cultivate American talent to enhance the nation's math, science, engineering, and foreign language expertise; and (3) Continue to attract and retain the best and brightest international students, scientists, engineers, and scholars. This report is in three parts. The first highlights the most significant recommendations contained in the Initiative. The second is a narrative that lays out the challenges, historical background, and a broad description of the Initiative. The third section of the report provides a detailed list of recommendations. Contains 4 figures.)