A study examined the impact of the National Foundation for the Improvement of Education (NFIE) Dropout Prevention Program on teachers and the implications of the program for professional development. Kindergarten through high-school classroom teachers designed their own projects, applied for grants, controlled project budgets, directed implementation, and evaluated the outcomes. Data came from interviews with participating teachers and NFIE staff, a retrospective survey of 57 teachers who directed projects during 1986-1991, case studies of 4 representative projects, Dropout Prevention project evaluations and annual reports, and student outcomes collected by projects funded in school years 1991-92 and 1992-93. Teachers said they improved their leadership abilities; improved their teaching of at-risk children; developed their collaboration, teamwork, and networking skills; and gained skill in proposal writing. Of the projects funded during 1991 through 1993 that documented a standard set of student outcome variables, the majority reported improvements in attendance, behavior, grades, promotion/retention rates, and test scores. Dropout Prevention projects often produced a ripple effect beyond the immediate circle of participating teachers and students. The Dropout Prevention program experience highlights issues that others might consider in formulating their own policies for professional development and school reform, including teacher-directed grants, new teacher roles, site-based management, systemwide reforms, teacher time, and children at risk of school failure. The program experience also suggests roles for state and local National Education Association affiliates to play in supporting professional development programs focused in children at risk of school failure. (Contains 24 references. An appendix presents information on data sources and 12 figures of data.) (RS)