The relationship between higher education and government is examined in light of such issues as institutional autonomy, institutional accountability, and the need for renewed balance between government authority and institutional freedom. The overview in Chapter One offers numerous recommendations for improving the relationship between government and higher education. Recommendations include the following: creation of a single enforcement agency for equal opportunity laws and regulations; reform of the federal financial aid program to insure aid to the needy; modification of Title III; establishment of a National Education Loan Bank; and more funding in areas of research and fellowships. Other chapters discuss: the basic problem between higher education and government; federal regulation; the role of the states; financial aid; federal support for academic research; government and the education of physicians; and Why should we care? Appendices include studies prepared by the Sloan Commission on Government and Higher Education and references; source materials; and basic tables on each chapter. Acknowledgements and notes on members of the Sloan Commission responsible for the study are provided. (LC)