The purpose of this study was to compare the development of integration and inclusion between the United States and Hong Kong, and to examine the status of Adapted Physical Education in Hong Kong. The approaches and policies related special education (after 1970s) were reviewed and analyzed. A survey was conducted regarding students’ attitude about inclusion. The results suggest that Hong Kong may be closely following the international trend of moving from integration to a whole-school inclusion approach (117 integrated schools). Meanwhile, the development of separate special educational setting continues to gain momentum to cater to students’ special needs, with a rate of development stronger than that of the inclusion model (74 schools for six different type disabilities). The second focus of this study was on teacher preparation and factors influencing the development of special education. The findings indicated that, in addition to government policies, attitudes and lack of special education training for current teachers and students in teacher preparation programs were two important factors that influenced in education of students with disabilities in the regular setting. The study argues that the learning environment (includes peers and parent’s attitude; teachers’ knowledge; support services) must be well prepared before including students with disabilities into the regular school setting. Without well prepared support services such as TA or other accommodations, students with disabilities will not benefit from these educational environments.[Copyright © 2004 The Hong Kong Institute of Education.]