Not all secondary schools in Kentucky participate in the KHSAA. About two dozen small, private religious schools are sanctioned by the Kentucky Christian Athletic Association. KHSAA was created by the Kentucky Department of Education to manage high school athletes in Kentucky. 
Whether public, private, or federally administered, all member schools compete for state championships on an equal basis. Unlike some other states' school athletic governing bodies, the KHSAA governs only athletics; it does not govern band, academic competitions or other extracurricular activities. These activities are governed by separate bodies.
Unlike the situation in most states, the default in Kentucky is to conduct a single state championship for all schools, with no classification of schools by enrollment. Most notably, Kentucky does not divide schools into classes in basketball, with Delaware being the only other remaining state with a single state basketball championship for each sex. Of the 13 sports in which the KHSAA sanctions state championships, only three are organized in multiple classes—cross-country, football, and track. As of the 2007-08 school year, the classification rules for the three sports which are divided are:
Class 6A — The 36 largest schools in the state, based on average enrollment (see below) of boys only, among schools that sponsor the sport.
Class 5A, 4A, 3A, 2A — Each with 36 schools, in decreasing order of enrollment
Class A — All remaining schools that sponsor football after the other classes are filled
The 2007-08 school year was the first for a six-class alignment in football; previously, a four-class system had been used.
Schools were allowed to petition the KHSAA for reclassification before the football realignment became final. Eleven schools requested that the KHSAA place them in a higher class than their enrollment warranted; six of these requests were approved. No school was allowed to play in a lower class, although the KHSAA accepted one school's request to adjust its enrollment downward. As a result of these requests, the final number of schools in each classification was:
In all three sports, classification is based on a four-year average enrollment in grades 9 through 12. Single-sex schools are deemed to have double their actual average enrollment for cross-country and track; prior to the 2007 realignment, football also used this rule. In cross-country and track, the KHSAA rule is to divide the classes so that 40% of all schools that sponsor the sport are in Class A and 30% are in both Class AA and AAA.
As is standard for high school sports in the U.S., students are limited to four consecutive years of eligibility (grades 9-12), whether or not they participate in any sports during one or more of those years. In football and soccer, students are not allowed to play on the varsity until they are actually enrolled in the ninth grade, and wrestlers cannot compete until they have entered the seventh grade. In other sports, there is no grade restriction; for example, current NBA player O. J. Mayo first played on a high school varsity team as a seventh-grader at Rose Hill Christian School in Ashland, and current PGA Tour golfer JB Holmes first played on the golf team of Taylor County High School in Campbellsville while in the third grade. The eligibility "clock" for such students does not start until they enter ninth grade.
Like all U.S. jurisdictions, Kentucky has an upper age limit for high school athletic participation. The KHSAA rule is that students must be under age 19 as of the July 31 preceding the current academic year. This particular rule is actually codified in Kentucky Revised Statutes § 156.270(2)(e).
A student who is repeating a grade during high school for any reason is not allowed to compete during his or her second year at that grade level.
Homeschoolers are prohibited from participating in any KHSAA-sanctioned activities. Moreover, KHSAA schools are also prohibited from competing against teams composed of homeschoolers.
↑This does not include the new Harlan County High School, a 6A-classified school which opened in August 2008. It did not compete in district play in the 2008 season, making it ineligible for the state football tournament.
↑James A. Cawood High School, classified as 3A, closed after the 2007-08 school year. The students previously zoned to that school now attend Harlan County High.
↑Two Class A schools in Harlan County, Cumberland and Evarts High Schools, also closed in 2008 to make way for Harlan County High.