This report examines the relationship between the federal government and research intensive universities (RIUs) in light of loss of public confidence, changes in the economy, and international challenges. In reviewing the health of the nation's research intensive universities and their relationship with the federal government the report looks at six main areas: (1) limits, and the new resource environment; (2) education, and the importance of teaching; (3) public trust, and restoring confidence in the universities; (4) investments, and federal support; (5) two cultures: university and industry; and (6) scientific talent and how to tap into it. In discussing economic limits the report notes the central importance of research in an increasingly competitive world and urges strategies to maintain the high quality of postsecondary education. With regard to the education role of RIUs the report argues for increased involvement with teaching. In looking at shaken public confidence due to cases of scientific misconduct and misuse of federal funds the report calls for establishing effective measures to maintain intellectual and fiscal integrity. A discussion of federal support for RIUs' continued investment in sciences and technology research argues against cost-sharing, and for long-term funding criteria. In exploring the relationship between universities and industry the report urges a wide range of concerted actions and the exchange of scientists and engineers at all levels. Finally, in a look at tapping the nation's talent base, the report suggests identifying and supporting the development of scientifically-gifted children from an early age. (JB)