I'm a first-year grad student studying physics. I've always heard that grades in grad school don't matter too much; just maintain at least a 3.0 GPA, or whatever the minimum is to maintain funding, and everything's fine. Since "grades don't matter," I haven't put too much focus on classwork. I work on the material with an eye towards passing my qualifying exams, but I haven't devoted all my effort to homework and studying for exams. After all, research is more important than grades, right? So, imagine my surprise, when another grad student in our group was emphatic that grad school grades do, in fact, matter. His argument is that funding agencies (e.g., the NSF) and future employers look at your grad school transcripts when you're applying for fellowships or jobs. He firmly believes that you need to get as close to a 4.0 GPA as possible, even in grad school. Now, my GPA isn't anything to write home about (it's in the 3.3 - 3.4 range...nothing below a B), but it's above that crucial 3.0 mark. So, I'm curious: Does your GPA in grad school matter? Should I be working harder in my classes?