This report compares Texas's reading and mathematics performance on the most recent administrations of the state assessment with performance on the National Assessment of Educational Progress (NAEP). To indicate how Texas is doing in narrowing the academic achievement gap between African American and Latino students and their white, middle class peers, the report presents NAEP data by race/ethnicity. The report presents other state-level data on K-college education, including demographic distribution across each educational level, participation and success in Advanced Placement, percentage of students taking high-level courses, school funding gaps, and high school and college graduation rates. In 2002, 93 percent of all 4th graders performed at the passing level on the state reading assessment. On the 1998 NAEP reading assessment, 63 percent of 4th graders performed at the basic level, while 29 percent performed at proficient or above. In 2002, 93 percent of all 8th graders performed at the passing level on the state mathematics assessment. On the 2000 NAEP 8th grade mathematics assessment, 68 percent of Texas students performed at the basic level or better, while 24 percent performed at proficient or above. Texas's Latino-white 4th grade reading achievement gap was 20th among the states on the 1998 NAEP, while the Latino-white 8th grade mathematics achievement gap was the fifth smallest nationwide on the 2000 NAEP. African Americans and Latinos are underrepresented in Advanced Placement (AP) exam taking, while Asian Americans have a high rate of AP test taking. Over 30 percent of Texas high school students enroll in college, compared to 54 percent nationwide. About three in ten Texas secondary classes are taught by teachers lacking a major or minor in the field. Districts with the highest child poverty rates, and those with the highest minority enrollments, have the fewest state and local dollars to spend per student. (SM)