This Report marks the transition between the Commission's activities under the 1972 Great Lakes Water Quality Agreement (GLWQA) and those under the 1978 Agreement. The Report gives an overview and a lake-by-lake description of the water quality in the Great Lakes Basin during 1978 with an indication of some broad changes that have occurred since 1972, and provides comments and recommendations stemming from an assessment of progress under the 1972 Agreement. A range of problems arising from industrial and municipal dischargers to the Lakes are addressed, including toxic and hazardous substances and hazardous waste disposal; phosphorus and eutrophication; the long range transport of airborne pollutants, and radioactivity. Finally, the Report deals with the topics of Great Lakes surveillance, Commission institutions and new directions under the 1978 Agreement.