This document is the eleventh annual report of the National Center for Education Statistics, issued in response to its continuing mandate to report full and complete statistics on the conditions of education in the United States. The report employs a chartbook format to convey statistical information in a nontechnical way to a general audience. Along with the narrative, each topic entry consists of a table along with a chart highlighting the data in the table. The first part is an overview of trends in (1) elementary/secondary education (enrollment, resources, finance, performance, and state activities to improve performance); and (2) higher education (enrollment, resources, finance, and degrees). Special emphasis is given in subsequent chapters to (1) elementary/secondary school teachers (teacher supply and demand, characteristics of teachers, teacher certification, and teaching incentives); and (2) educating handicapped students (the national perspective and family background as it relates to provision of special education); and (3) the transition from high school (high school dropouts and re-entrants, terminal degree graduates, and postsecondary education participants). An appendix provides data sources and definitions of selected terms, and a cumulative index lists topics and data shown in volumes published from 1982 to l985 inclusive. (TE)