The report was grounded on on-site visits of leading Portuguese Universities, Polytechnics and Business Schools as well as on written statements of the institutions visited. Additional material has been provided by the Ministry of Education. The article tries to give an appraisal of the actual state of the art of university level distance education in Portugal covering issues such as spread of distance learning so far, attitudes towards distance learning, pedagogical models, access, funding and quality issues. On the basis of this analysis some policy recommendations are formulated by the authors.