As the largest single producer, consumer, and disseminator of information in the United States, the Federal government has enormous power to influence the development and diffusion of new information technologies. Through the use of electronic information systems, it also has the opportunity to make more government information readily available to more public users. Defining the appropriate uses of, and controls on, this power are of critical importance in determining whether the government will be a positive or a negative force, particularly with respect to the private sector. Although there has always been, and probably always will be, some competition between government and private sector information products and services, there is agreement that the laws and policies regulating government information practices do not, and should not, require or permit a Federal agency to provide information products and services in the same manner as a private company. Federal agencies must be careful not to exploit the power inherent in electronic data systems by providing nonessential services to the public simply because the capability to provide such services exists. Instead the government should assume an affirmative obligation to review each electronic information activity carefully in order to avoid unnecessary government interference in the marketplace for information products and services. Further, as the government becomes increasingly involved in the use of electronic collection and dissemination, it must also learn to differentiate among levels of service and requirements of various user communities. Positions of the Association of Research Libraries, the National Commission on Libraries and Information Science and the Information Industry Association are presented and are shown to be in surprising harmony with the policies of OMB Circular A-130 and the views of the House Committee on Government Operations. The Securities and Exchange Commission's EDGAR system and recent development in distribution og government information on CD-ROM are reviewed as examples of the implementation of these policies.