  We describe a class of 4d N=1 compactifications of the $SO(32)$
heterotic/type I string theory which are destabilized by nonperturbatively
generated superpotentials. In the type I description, the destabilizing
superpotential is generated by a one instanton effect or gaugino condensation
in a nonperturbative $SU(2)$ gauge group. The dual, heterotic description
involves destabilization due to worldsheet instanton or $\it half$ worldsheet
instanton effects in the two cases. A genericity argument suggests that a
(global) supersymmetry-breaking model of Intriligator and Thomas might be
typical in a class of string theory models. Our analysis also suggests that the
tensionless strings which arise in the $E_8 \times E_8$ theory in six
dimensions when an instanton shrinks to zero size should, in some cases, have
supersymmetry breaking dynamics upon further compactification to four
dimensions. We provide explicit examples, constructed using F-theory, of the
two cases of dynamically generated superpotentials.
