We are studying a Next Generation X-ray Observatory, NGXO, that will provide a high resolution spectral capability with large collecting area, at a relatively low cost. The mission consists of two co-aligned telescope systems that provide coverage from 0.3 - 60 keV. One is optimized to cover the 0.3 - 12 keV band with 2 eV spectral resolution using an array of quantum calorimeters with a peak effective area of 2,000 cm2. The spectral resolution will be five times better than the calorimeter planned for Astro-E, with more than a ten-fold increase in effective area over previous high resolution x-ray spectroscopy missions. The second telescope will be the first focusing optics to operate in the 10 - 60 keV energy range, and will have arc minute angular resolution with 500 cm2 collecting area at 30 keV. The sensitivities of the two telescopes are matched to make possible many thousands of high quality x-ray spectral observations, from an available population of more than one million galactic and extragalactic x-ray sources. The NGXO mission is capable of addressing new astrophysical problems which include: determining the mass of a black hole, neutron star, or white dwarf in binary systems from x-ray line radial velocity measurements; determining the 0.3 - 60 keV x-ray spectrum from AGN and determining their contribution to the x-ray background in this energy band; measuring Compton reflection spectra from cold material in accretion driven systems; determining the Hubble constant using resonant line absorption of QSO spectra by rich clusters; searching for a hot 10 million degree intergalactic medium; mapping the dynamics of the intracluster medium; mapping the ionization state, abundance and emission from supernova remnants on a 15 arc second angular scale; and measuring mass motion in stellar flares and the dynamics of accretion flows.