This paper presents a grounded theory of educational partnership process. A case-study design was used to describe aspects of the partnership process of the Cooperative Alliance for Gifted Education (CAGE) during part of its second year of operation. Three organizations served as partners: a large urban school district, a state university, and a large corporation. Funded through the Educational Partnerships Program, CAGE was a 4-year project designed to integrate inquiry learning and the authentic use of technology in the K-12 curriculum, develop nontraditional assessment of exceptional potential of disadvantaged and minority students, and study the development of the partnership itself. Data were gathered from three subgroups of the partnership--3 CAGE partners, 3 members of the Joint Partnership Advisory Council, and 4 local experts on partnership process--through interviews, audio- and video-tapes of member meetings, document analysis, and a modified Q-sort activity. Common characteristics and conditions identified in the study were also found across existing theory and research. Thirteen categories used to describe the partnership process were identified, which showed that collaboration required some modification in operating procedures. Partners expected one another to operate as peers, to seek consensus, and to be committed; members' roles and responsibilities were related to their strengths and expertise; and involvement was sustained because of a shared project focus on goals and outcomes. Implications for practice are that: (1) leaders and directors can enhance the effectiveness of an educational partnership by monitoring and managing the partnership process; and (2) leaders and directors can maintain commitment of members by encouraging focus on worthwhile goals, identifying and communicating successful outcomes, and facilitating opportunities for professional growth. Three figures and three tables are included. Contains 54 references. (LMI)