As part of its evaluation of the development of the Navy's $3 billion Cooperative Engagement Capability (CEC) program, the General Accounting Office (GAO) reviewed the transfer of certain frequency spectrum, within which CEC operates, to the Federal Communications Commission (FCC) for reallocation to the private sector. Originally, the Department of Defense (DOD) did not concur with, but accepted this transfer. Recently, DOD officials have expressed concerns to the Department of Commerce and the Congress that the loss of specific frequency bands from exclusive military use could seriously impair how well CEC and other DOD systems will eventually operate. This report discusses GAO's analysis of whether (1) the capabilities of the CEC program could be adversely affected by this transfer, (2) other systems could also be adversely affected by this transfer, and (3) DOD, FCC, and the Department of Commerce are taking appropriate and adequate steps to prevent or minimize such impairment. Also discussed are potential actions that could more effectively achieve the intent of the Omnibus Budget Reconciliation Act of 1993 to minimize negative impacts of frequency reallocation on the federal government. This review was performed under GAO's basic legislative responsibility and contains recommendations to the National Security Council, the Department of Commerce, FCC, and the Department of Defense. The report also includes a matter for congressional consideration.