This paper analyzes a marked change in the evolution of the U.S. wage structure over the past fifteen years: divergent trends in upper-tail (90/50) and lower-tail (50/10) wage inequality. The authors document that wage inequality in the top half of the distribution has shown a secular rise for the last 25 years (since 1980), while wage inequality in the bottom half of the distribution has grown rapidly from 1979 to 1987 but has since ceased growing (and for some measures actually narrowed). They find that occupational employment growth shifted from monotonically increasing in wages (education) in the 1980s to a pattern of more rapid growth in jobs at the top and bottom relative to the middle of the wage (education) distribution in the 1990s. This pattern is characterized as the "polarization" of the U.S. labor market, with employment polarizing into high-wage and low-wage jobs at the expense of middle-wage work. The authors show how a model of computerization in which computers most strongly complement the non-routine (abstract) cognitive tasks of high-wage jobs, directly substitute for the routine tasks found in many traditional middle-wage jobs, and may have little direct impact on non-routine manual tasks in relatively low-wage jobs can help explain the observed polarization of the U.S. labor market. The paper also discusses the divergence of upper- and lower-tail wage inequality since the late 1980s, the polarization of job growth trends in the 1990s, and the role of labor demand shifts in explaining wage structure changes over the last twenty-five years. The authors conclude that a conceptual framework focused on the changing distribution of job task demands, spurred directly by advancing information technology and indirectly by its impact on international outsourcing, helps explain the recent polarization of the U.S. wage structure. The similarity across several countries (the United States, the United Kingdom, and Germany) in employment growth polarization combined with some differences in wage structure changes suggests the need to seriously consider the roles of market forces, institutional factors, and their interactions in explaining the evolution of national wage structures.This paper analyzes a marked change in the evolution of the U.S. wage structure over the past fifteen years: divergent trends in upper-tail (90/50) and lower-tail (50/10) wage inequality. The authors document that wage inequality in the top half of the distribution has shown a secular rise for the last 25 years (since 1980), while wage inequality in the bottom half of the distribution has grown rapidly from 1979 to 1987 but has since ceased growing (and for some measures actually narrowed). They find that occupational employment growth shifted from monotonically increasing in wages (education) in the 1980s to a pattern of more rapid growth in jobs at the top and bottom relative to the middle of the wage (education) distribution in the 1990s. This pattern is characterized as the "polarization" of the U.S. labor market, with employment polarizing into high-wage and low-wage jobs at the expense of middle-wage work. The authors show how a model of computerization in which computers most strongly complement the non-routine (abstract) cognitive tasks of high-wage jobs, directly substitute for the routine tasks found in many traditional middle-wage jobs, and may have little direct impact on non-routine manual tasks in relatively low-wage jobs can help explain the observed polarization of the U.S. labor market. The paper also discusses the divergence of upper- and lower-tail wage inequality since the late 1980s, the polarization of job growth trends in the 1990s, and the role of labor demand shifts in explaining wage structure changes over the last twenty-five years. The authors conclude that a conceptual framework focused on the changing distribution of job task demands, spurred directly by advancing information technology and indirectly by its impact on international outsourcing, helps explain the recent polarization of the U.S. wage structure. The similarity across several countries (the United States, the United Kingdom, and Germany) in employment growth polarization combined with some differences in wage structure changes suggests the need to seriously consider the roles of market forces, institutional factors, and their interactions in explaining the evolution of national wage structures.