The activities of the Artificial Intelligence laboratory can be viewed under three main aspects; (1) Artificial Intelligence- understanding the principles of making intelligent machines along the lines discusses in previous proposals, and elaborated below. (2) Natural Intelligence- As we understand intelligence better we see fewer differences between the problems of understanding human and machine intelligence. We have been increasingly able to translate our ideas about programming machines into ideas about educating children, and are currently developing systematic methods in elementary education. And conversely, we attribute to our observations and experience in the latter activities much of what we believe are important new conceptions of how to organize knowledge for programs that really understand. (3) mathematical theories; This aspect is relevant not because we often need to solve specific mathematical problems but especially because we are firmly committed to maintaining a mathematical style in the laboratory. In many centers we have seen decline and deterioration following apparently successful "experiment" in artificial intelligence because the principles behind the performance were not understood, hence the limitations unseen.