It is proposed that research universities are a vital component of higher education in the United States because they provide cultural and intellectual leadership, research potential, and the professional and technical human resources to translate research into social, industrial, and economic action. The future of these institutions in view of declining enrollments and financial resources is discussed. Major factors seen to affect the research universities are financial resources and their ramifications: complex competition for state funds; alleged over- and underproduction of highly trained personnel; inadequate means for assessing costs and benefits of graduate education and research; and inconsistent criteria for establishing and dismantling graduate programs. The high undergraduate dropout rate is viewed as contributing to the problems of research universities, and may be a result of these factors: the decline of general education, emphasis on graduate programs, emphasis on faculty research and publication, and growing departmentalization. Other factors affecting the future of these institutions are competition among universities and collective bargaining for the faculty. (MSE)