This report traces the evolution of the Sullivan Country Festival of the Arts and changes in the curriculum and social life of the schools of Sullivan County. It summarizes the experiences and conclusions of a three-year period of activity in a pilot-demonstration project of the Division of the Humanities and Arts of the New York State Education Department. The Festival featured eight programs or modules in opera, dance, theater, and film. Students were prepared for the programs by means of lecture-demonstrations in assemblies and classroom workshops of artists and students together. Three phases of the project, based upon changes in the planning and preparation of the modules, are described. Appendices include: a report of project costs; an analysis of costs; documents and publications generated by the project; summaries of preparation, performances and personnel involved in each module; attendance statistics; and a list of administrative and supportive personnel involved in the project. (SHM)