A charter school is a publicly funded, tuition-free school that operates independently of its local public school district. It is a school of choice: families choose to send their children there, rather than being assigned a school by where they live. In exchange for freedom from many of the rules that govern ordinary public schools, a charter school must meet the terms of a contract, called a charter, that sets out its mission, its academic goals and its finances.

Charter schools returned to the headlines on 10 November 2026, when a court in Tennessee ruled that the state's ban on religious charter schools was unconstitutional. This guide explains what charter schools are, how they are funded, who holds them to account, and how they differ from ordinary public schools and from private schools.

Are charter schools public or private?

Charter schools are public schools. They receive government funding, they cannot charge tuition, and they are open to all pupils, with places allocated by random lottery when demand exceeds capacity. Under federal law they must be nonsectarian in their programmes, admissions and employment, and they must comply with the same federal civil rights and safety laws as other public schools.

At the same time, they operate with a degree of independence from local school districts. They are usually run by a non-profit organisation, and in some states a minority are run for profit. Federal figures put the number of charter schools in the United States at about 7,800, teaching about 3.7 million pupils, as of 2021.

How does a charter school get its charter?

A charter is a performance contract between the school and an authoriser, which is usually a state agency, a university or a school district. The contract sets out the school's educational plan, its financial arrangements and how its performance will be measured. Charters are granted for a limited term, usually three to five years, and the authoriser can refuse to renew a charter, or close a school, if it fails to meet its terms.

The first charter school law was passed in Minnesota in 1991, and the first charter school opened there in 1992. Charter school laws now exist in 46 states and the District of Columbia, although the rules on who can authorise a school and how it is funded differ from state to state.

How are charter schools funded?

Charter schools are funded mainly from public money. State and local funding generally follows the pupil, with a per-pupil amount moving from the home school district to the charter school. They also receive federal money for services such as special education, and the federal government gives grants to open new charter schools. On average, charter schools receive less public funding per pupil than the district schools around them, and most states do not pay for their buildings. They may also raise money from private donations.

How do charter schools differ from other schools?

The main difference from an ordinary public school is autonomy. Charter schools have more freedom over staffing, curriculum, the length of the school day and how they spend their money. In return, they are held to the terms of their charter and can be closed if they underperform, which is a sharper form of accountability than most district schools face.

The main difference from a private school is that charter schools are free and publicly funded. Private schools charge fees, set their own admissions rules and are not bound by a public charter. A charter school cannot select pupils by ability or faith, and it cannot teach religious doctrine as part of its programme.

Sources: Encyclopaedia Britannica on charter schools and Education Week on how charter schools work.