U.S. manufacturing capabilities are a key component of our global economic competitveness. Because the U.S. fell behind in several important manufacturing industries-especially in competition with the Japanese-federal attention to the health of these industries has grown. The Japanese cut into U.S. leadership through their attention to quality and continuous improvement. Current challenges in the field include reaping productivity benefits from computerization, developing environmentally friendly manufacturing methods, and shifting the federal research and development (R&D) emphasis from military defense to industrial R&D, including manufacturing technologies. Current federal proposals to increase federal support of manufacturing technologies may play an important role in future competitiveness of U.S. industry. The challenge is to grow these programs fast enough to meet the goals of defense conversion, yet not so fast that we do them poorly. Recommendations are offered on practical ways to target, adjust and apply these proposals.