This report describes work by the Los Alamos Scientific Laboratory (LASL) on the development of hot dry rock as a geothermal energy source conducted during fiscal year 1978 (FY78: October 1, 1977 through September 30, 1978). During this period, significant technical progress was made at the first development and demonstration site, which was located at Fenton Hill, New Mexico. The demonstration of technological feasibility by this project prompted the Department of Energy (DOE) to expand it into a program of national scope