Burley tobacco is the second most important kind of tobacco grown in the United States and is an important component in American blend cigarettes that are increasingly popular worldwide. Burley tobacco is grown in eight States, but Kentucky and Tennessee accounted for 86 percent of U.S. production in 1990. The average burley farm plants only about 3 acres in burley tobacco, producing about 6,500 pounds worth just over $10,000. Farmers typically grow burley in conjunction with other crop or live- stock enterprises. This report examines the structure and characteristics of burley tobacco farming in Kentucky and Tennessee using data from the 1989 Farm Costs and Returns Survey and makes comparisons with data from previous years' surveys.