This mixed-methods grounded theory study examined student and faculty perceptions of engagement in Interactive Television (ITV) courses. Survey participants from two regional higher learning institutions consisted of students (n = 442) and faculty (n = 99) with previous ITV experience. Data were analyzed using principal factor analysis, Independent T-test, and ANOVA. Qualitative data consisted of focus groups and student (n = 22) and faculty (n = 10) personal interviews. Factor analysis of survey data identified three engagement themes: dialogic, autonomous, and interpersonal. Significant differences were noted between student and faculty perceptions on all three factors. Faculty rated levels of dialogic and autonomous interaction lower than students, while students reported lower levels of interpersonal interaction. Qualitative coding revealed that students attribute lower dialogic and autonomous interactions to reduced interpersonal interactions. What initially emerged as a simple three-factor model of student engagement in quantitative analysis, became a model of three factors driven by one prominent factor -- interpersonal interaction.