A premise of charter school initiatives has been that these schools have direct benefits for the students attending them and indirect benefits for other students by creating competition for traditional public schools to improve their performance. This study uses a two-pronged approach to assess whether California charter schools are having indirect effects on students in traditional public schools. First, we examine how traditional public school principals react to the introduction of charter schools. Second, we assess whether competition from nearby charters is affecting student achievement outcomes for students that remain in traditional public schools. The survey results show that traditional public school principals felt little competitive pressure from charters. Similarly, the student achievement analysis shows that charter competition was not improving the performance of traditional public schools. These results suggest that California charter schools are having little effect on the climate of traditional public schools.