Of all the reform efforts current in teacher education, the professional development school (PDS) advocated by the Holmes Group shows the greatest promise because it seeks to tie reforms in teacher education to reforms in schools themselves. This document describes how one institution of higher education (University of Utah) and one school district (Salt Lake City, Utah) have together implemented professional development schools. The report presents data on the effectiveness of the PDS program in educating novice teachers and discusses several dilemmas confronted in the evolving PDS partnership. The dilemmas that have emerged from this PDS-creating experience are: democracy versus coherence; collaboration versus academic freedom; didactic versus conceptual views on teaching and learning; replicative versus reflective orientations; program continuity versus equity in faculty loads; and basic versus applied research. Forty-two references are included. (IAH)