Korea National Open University (KNOU) opened in 1972 as a correspondence college designed to improve adult learners' preparation for Korea's college examination. KNOU has been redefined as "an institution for adults who are deprived, by various reasons, of higher education opportunities and is now playing a major role in developing lifelong learning in Korea. Although KNOU's enrollment increased from 12,000 in 1972 to 314,438 in 1998, it is struggling with a high dropout rate. Among the immediate challenges facing KNOU are to do the following: (1) develop a new curriculum and more flexible delivery system that will meet the unique needs of its changing student body (which is increasing in age and including increasing numbers of transfers from conventional universities or junior colleges); (2) improve its student assessment system; (3) learn to use technology more cost-effectively; (4) give professors more time for research; (5) improve its tutor and learner support systems; (6) give students more choices in selecting courses; and (7) obtain more funds (either by obtaining more government funding or increasing its student fees). KNOU is continuing to build a foundation for open and lifelong learning through implementation of the Cyber University Trial Project, establishment of the Center for Lifelong Education, and institution of a quality assurance system. (MN)