A few years ago, one could easily detect a growing sense of hope and prosperity for virtual universities in America. Many state leaders believed that distance learning could expand educational access and increase economic development, and that putting resources into a consortial virtual university made sense financially. State-wide agencies saw opportunities to explore, develop, and influence policy innovation outside of traditional structures. Presently, more than 70 state-wide or system-wide virtual universities exist in various forms, and yet we know relatively little about them and their impact on American higher education. The State Higher Education Executive Officers (SHEEO) and the Western Cooperative for Educational Telecommunications (WCET) have cosponsored a national study of consortia-based virtual colleges and universities to help state policy leaders better understand and assess the role of virtual universities in meeting state education goals. In this session, researchers will make the first public release of findings from the study, while addressing such questions as, Is there a need for virtual universities as separate organizational entities, or are they best seen as temporary, transitory instruments of change? What are the major successes, failures, and unexpected outcomes of virtual universities?