This report discusses in detail the research and development (R&D) elements of the Reagan Administration's budget for Fiscal Year (FY) 1985. Following an introduction (chapter I), chapter II presents an overview of R&D funding in the President's FY 1985 budget. The chapter begins by describing overall R&D spending in terms of the major catagories of R&D (basic research, applied research, and development) followed by discussions of policy goals that have motivated the overall pattern of R&D funding and of federal R&D funding by budget function, including projections of 1989 funding levels. Chapter III discusses the R&D budgets of the 10 government agencies that are the largest sponsors of R&D. They are the Department of Defense, National Aeronautics and Space Administration, Department of Energy, National Science Foundation, Department of Health and Human Services, Department of Agriculture, Department of the Interior, Environmental Protection Agency, Department of Transportation, and Department of Commerce. Each agency discussion concludes with a brief statement of the major policy issues raised by the agency's R&D budget. (JN)