On June 12, 1999, about 1025 eastern daylight time, a Cessna 182R, N6126E, registered to R and R Aircraft Sales, operating as a Title 14 CFR Part 91 instructional flight, crashed on takeoff from Gatlinburg-Pigeon Forge Airport, Sevierville,Tennessee. Visual meteorological conditions prevailed and no flight plan was filed. The aircraft sustained substantial damage and the student pilot, the sole occupant, received minor injuries. The flight originated 25 minutes before the accident. According to the pilot, he was conducting full-stop landings, and on his second takeoff, at about 300 feet agl, the engine or propeller "just quit pulling". He applied carburetor heat with no improvement and when he realized power available would not sustain level flight, he felt his only option was to attempt a forced landing in a field. According to an FAA inspector, the pilot described the airplane's power response before the crash as, "..like an automobile automatic transmission slipping". Postcrash inspection revealed the airframe's flight controls were intact and functional. The engine's six cylinders had ignition spark and compression, and the drive train was intact. The carburetor contained uncontaminated 100 LL octane fuel. One propeller blade was bent rearward about 20 degrees from the hub and the other blade was straight, but broken loose in the hub. The propeller governor was removed and shipped to the factory for inspection and testing. Factory disassembly inspection of the propeller governor, model No. C290D3-F/T14, serial No. 821368, revealed heavy sludge in the ports used to channel oil to the propeller. Dirty oil was found in the head assembly cup, and heavy sludge was found to prevent the flyweight components from moving freely. The governor components were cleaned up, reassembled, and although the flyweight assembly had not been changed per factory service bulletin, it functionally tested satisfactorily and met current specifications. The factory conclusions pertaining to the operation of the governor were, "[The factory] could find nothing that mechanically could cause any problems during operation of the aircraft. An area of concern is the amount of sludge and condition of the oil which could cause erratic operation. Judging from the condition of the unit, [the factory] does not believe the owner has given much consideration to a regular maintenance of the system". The factory report is included in this report.