In recent years, the information technology (IT) revolution has transformed American industry--leading to new types of work processes and business organizations, and increased productivity and consumer innovations--but by and large, this game-changer has bypassed America's schools. Virtually all K-12 schools in the country are connected to the Internet, and the student-to-personal computer ratio has declined steadily. Unfortunately, however, IT has been limited to reinforcing--albeit improving--existing modes of teacher instruction rather than transforming them. This is not good enough. America's K-12 education system not only is failing to educate most students well, contributing to a decline in U.S. economic competitiveness, but is increasingly not financially viable. Fortunately, IT has the power to dramatically remake American schooling, raising performance while potentially simultaneously cutting costs. This report discusses why the existing school reform movement has stalled, how IT can enable the emergence of fundamentally new kinds of schools, particularly middle and high schools, and what the states and the federal government need to do to drive the emergence of these new ways of educating our nation's future generations. In particular, we believe that IT is enabling the emergence of a new kind of pedagogy that is focused on meeting the needs of individual students ("mass customization"). This IT-enabled approach would mark a departure from current pedagogy in which all students are treated more or less alike ("mass production"). To drive this kind of fundamental pedagogical reform in the direction of "mass customization," IT believes that the federal government and states should do the following: (1) Each state should establish a state-level "New-Schools" entity for innovation, with the power and authority to realize a program of school innovation enabled by IT; (2) The Obama Administration should become a champion for school redesign and the creation of "NewSchools" authorities; (3) Congress should create a "NewSchoolsAmerica" Fund; and (4) Congress should allow new innovative schools to be evaluated outside the framework of the federal No Child Left Behind Act (NCLB). (Contains 2 figures and 28 endnotes.)