This report address considerations in the 1995 farm bill debate for cotton, including market conditions, policy proposals, trade agreements, and the interactions between policy and markets for selected commodities. The Food Security Act of 1985, and subsequent cotton marketing loan modifications, are analyzed, as they formed the basic provisions of the Food, Agriculture, Conservation, and Trade Act of 1990. Cotton provisions of the 1990 Act attempted to ensure that cotton remained competitive in domestic and world markets. Program performance is discussed, including the effects on producers, consumers, and taxpayers. Important issues and policy options to be addressed during the 1995 farm bill debates are presented. Background information is also provided on the characteristics of the U.S. cotton industry including current trends in production, consumption, and foreign trade. Financial aspects of the cotton sector including prices, costs, and producer returns give additional perspective and understanding to the report.