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This paper documents several years of experimentation with a new approach to organizing and managing projects in a software engineering course. The initial failure and subsequent refinements that the new approach has been through since 2004 are described herein. The “constrained and guided” approach, as it is called, has helped to reduce project failure rates, increase specification fulfillment rates, and improve the design quality of student projects. It has also enabled the instructor to evaluate student projects more objectively. The questionnaire survey conducted in this study also shows that students greatly appreciated the new approach because it enabled them to manage projects more effectively.