Summary: From 1980 to 1995, the total federal and state prison population grew at an average annual rate of 8.5 percent. The total prison population rose from about 330,000 inmates in 1980 to about 1.1 million inmates in 1995--an overall increase of 242 percent. Federal and state corrections agencies, as well as forecasting groups like the National Council on Crime and Delinquency, project that the prison population will continue to grow in the future. The size of the prison population is a function of several factors, including crime levels, sentencing laws, and law enforcement policies. Inmate population growth in recent years can be traced in large part to major legislation intended to get tough on criminals, particularly drug offenders. Examples of this new get-tough policy include mandatory minimum sentences and repeat offender provisions. Reflecting the growth in inmate populations, U.S. prison (federal and state) annual operating costs swelled from $3.1 billion in fiscal year 1980 to about $17.7 billion in fiscal year 1994. All prison costs (operating and capital costs) totaled about $163 billion during the 15-year period. The Bureau of Prisons projects that its prison operating costs could total about $3.6 billion in fiscal year 2000--an increase of about 88 percent over the fiscal year 1994 level. Moreover, the Bureau estimates that it may need as much as $4 billion to build new federal prisons through fiscal year 2006. This report also discusses the models and methodologies used by federal and state corrections agencies and nongovernmental forecasting organizations to make these projections and examines whether validity or reliability assessments have been done.