The unusually high rate of inflation has produced a clear demand for more vigorous government action to lower the rate of price increase, including increases for health professional schools. The concern coincides with Congressional debate surrounding the renewal of the entire structure of federal support for the education of physicians, dentists, optometrists, and others. Two issues are addressed: (1) what has been the impact of inflation on the costs of health professional education, and (2) how will schools meet the growing burden? A brief overview is presented of both the structure of school costs and estimates of how they have been changing. Attention is paid not only to what has been happening but also to what is likely to occur. These estimates are balanced by a discussion of what has been and is likely to be the school response to cost pressures. Methods of cutting costs as well as increasing revenues are examined. The discussion offers a background for analyzing the impact on school financing of anti-inflationary policies; i.e., a tight monetary policy and expenditure reducing fiscal policy which includes cuts in federal support. Emphasis throughout the paper is on medical and dental schools. (LBH)