The teaching laboratory in physics departments in colleges and universities is a source of great potential strength in undergraduate education. Recent surveys and conferences, have identified inadequate teaching equipment and laboratory development. This report reviews these problems and offers suggestions for an enhanced federal effort to solve them. The role of experimental work in undergraduate physics and the need for improvement of instrumentation and course content are described. The objectives and history of the National Science Foundation's improvement program are outlined. The negative consequences of exclusion of doctoral institutions from the program support are discussed. Recommendations are made related to: (1) locus of responsibility; (2) funding; (3) terms of the competition; (4) laboratory development; (5) budget items; (6) improvement of the present situation; (7) regular evaluation; and (8) responsibilities of physics departments and their institutions. (YP)