A study on government regulation of religiously affiliated higher education was conducted for the Sloan Commission on Government and Higher Education. The following two questions were addressed: What legal problems arising from governmental regulation have religiously affiliated colleges experienced at least partially because of their religious affiliation? How might the relationship between government and these institutions be ameliorated? Religious preference in employment policies is examined in relation to federal statutory regulation, judicial decisions, and administrative regulations. Religious preference in student admissions policies is considered in relation to Supreme Court dicta and federal tax policy. Judicial decisions regarding government aid for facilities at religiously affiliated institutions and policy recommendations are examined. A legal analysis and policy recommendations are provided concerning the following areas: protection of the civil rights of handicapped persons, special tax problems, special labor law problems, The Fair Housing Act and the segregation of student housing on the basis of sex, sex discrimination in employment practices and in access to federally funded programs, participation of seminaries and seminarians in federal assistance to higher education, constitutional law and the status of religiously affiliated colleges, and state regulation. (SW)