The purpose of this study was to explore the production, communication, interpretation and contestation of new physical education (PE) and physical activity (PA) policy initiatives introduced in Mississippi and Tennessee for the academic year 2006-2007. These states provide a relevant context to study such issues, since Mississippi has the highest and Tennessee has the fifth-highest rate of childhood obesity in the United States (Trust for America's Health, 2009). The social-ecological model was used as a theoretical framework to interpret the social, economic, temporal, and political interactions that shaped the development, interpretation, and implementation of these policies (Stokols, 1992). A multiple-level case study design (Yin, 2003) was adopted in which the policy process was analyzed and compared across eight high schools. Four high schools were purposefully selected in each state that provided a broad range of contextual differences and collected data in real-time during a one-year period. We conducted 73 interviews with key stakeholders, including policymakers, school administrators, teachers and students, and observed PE lessons and school-based activities. The researchers identified themes from the data: "Policy process"; "Expectation of compliance"; "Unfunded mandate"; "Problematic policy enactment"; "Academic pressure"; "Marginalized status of PE"; "Narrow PE curriculum"; and "Dislike of PE". Even though new PE and PA legislation had been passed in both states, no substantive change occurred in any of the schools during our study. This work moves beyond a superficial understanding of how policy initiatives impact PA and PE provisions within schools, particularly at the secondary level. We recommend the development of support systems within the school through the creation of clear goals, strategic plans, and professional development to implement new policy initiatives. (Contains 1 table and 1 note.)