In deciding on the constitutionality of a variety of practices involving schools, courts have been increasingly called upon to balance the two First Amendment religious guarantees--that Congress shall not make any laws respecting the establishment nor prohibiting the free exercise of religion. This fifth chapter in a book on school law discusses four topics concerned with church-state issues affecting schools that have generated legislative and/or judicial activity since 1980. The first issue, voluntary, student-initiated devotional activities in schools, remains cloudy. Legislative bodies continue to consider provisions authorizing student-initiated prayer periods in public education. Regarding the second issue, holding religious holiday observances and displaying religious symbols in schools, the important point is whether the primary effect of the action is secular. The third issue, state aid to nonpublic schools, has recently been rekindled due to the controversy over tuition tax credits. Paralleling this discussion has been an effort to reduce state regulation of nonpublic schools, the fourth issue. The Supreme Court has consistently refused to review lower court rulings pertaining to regulation, leaving the scope of state authority unclear. (Author)