Agriculture is facing a number of challenges on the environmental front. The challenges are both legislative and regulatory and from both the federal and state levels. The next Congress will be very active on environmental issues that will affect agriculture. Since agriculture is the economic sector that will be most affected, it should develop a longrange comprehensive environmental agenda. Agriculture needs to establish working relationships with environmental groups. Such groups can be powerful allies for the production agriculture sector which will face serious challenges as Congress continues efforts to reduce the budget deficit. They can also be powerful opponents as they develop proposals which run counter to agriculture's interests.