The investigation in this study of inner-city elementary schools identified two main causes for successful learning environments. The strongest influence was thought to be the principal. An analysis of "problem oriented schools" showed that successful principals were prone to act independently of bureaucratic directives, and that they heeded teacher advice and attended to their needs; while the unsuccessful principals were more rigid and hierarchy oriented. The way that schools grouped students for academic work also appeared to be a factor. Schools which had grades K-6 had fewer discipline problems than those with K-8. This finding was attributed to the difficulty of disciplining junior high students and the influence of these more defiant seventh and eighth graders on younger students. Furthermore, teachers favored the self-contained classroom over the departmental system, since having one group of students enhanced both the teacher's disciplinary success and the warmth and mutual respect between teacher and student. Recommendations made in this study were: the hiring of principals with administrative skills necessary for running inner-city schools; elimination or minimization of formal written and oral qualifying examinations and of irrelevant credential requirements for picking administrators; and, pre-service and in-service training programs for administrators. (KG)