The paper asks what are appropriate policies for urban school reform in the context of global transformations affecting cities in both developed and "Third World" countries. Features of this transformation include growing population diversity, a semi-permanent underclass, and the informal economy. Comprehensive community development (i.e. economic, socio-political, and cultural) must promote alternative forms of integrating communities into the larger whole, in ways that emphasize "indigenous" knowledge and problem solving. Urban school reforms that promote culturally relevant education and community partnerships can make a contribution. However, the connections between school and community and school and work need to be rethought. The paper provides examples of strategies to convert new economic forms into life-sustaining opportunities and new social forms into structures that sustain the community. (Contains 55 references.) (Author)