To capture some of the benefits of small-scale schooling, educators are looking for ways to downsize, including dividing large schools into subunits or "schools within a school." This approach establishes within the school a smaller educational unit with a separate educational program and its own staff, students, and budget. This digest introduces the school-within-a-school concept, summarizes existing research, and reviews advantages and disadvantages. The various models used to downsize large schools differ on many factors, but the school-within-a-school model has the greatest levels of autonomy and distinctiveness. Because this model most closely replicates a small school, it is most likely to produce the positive effects of a small-scale educational organization. The literature suggests that implementation of the school-within-a-school model has met with varying success in different settings. The most critical factor is commitment to full implementation, allowing for complete administrative separation of the subschool and the creation of a separate identity. While research results are limited, this model has the potential to contribute to increased student well-being, sense of community, student achievement, and educational attainment. The model is especially promising for disadvantaged students, who are more likely to attend large schools. It is a cost-effective approach to school reform, but the challenge lies in successful implementation. (Contains 30 references.) (SV)