This bulletin summarizes the findings of a study that sought to determine what policies, regulations, and practices teachers believed posed the most significant constraints on their classroom activities; whether these constraints originated at the federal, state, local, or school level; and what effect the costraints had on quality instruction and innovation. Data were gathered through a telephone survey of 400 Indiana teachers and through focus group discussions with 65 teachers. Major constraints on classroom activities were found to be poor funding, large class size, lack of authority to discipline, ISTEP, mandated curriculum or textbooks, and required nonteaching duties. Teachers rarely cited the traditional school governance structure directly as a constraint. Effects of constraints on teachers' activities included: erosion of opportunities to exercise professional judgment, ineffective use of time, deficient resources, and general frustration. The paper concludes that teachers were more concerned with aspects of school improvement like additional funding, relief from nonteaching duties, and more planning time than they were with elaborate schemes for restructuring; and those teachers who were undertaking sweeping changes were, for the most part, not constrained from doing so by specific policies. (JDD)