Thirty-one percent of children in out-of-home care in the early 1990s were placed in the home of relatives. Factors such as the availability of foster homes, the demand for foster care, attitudes toward the extended families of troubled parents, and policies regarding payment for the costs of care have contributed to the rapid increase in kinship foster care. Research findings suggest that kinship foster homes can promote the child welfare goals of protecting children and supporting families, but they are less likely than traditional foster care to facilitate the prompt achievement of legal permanence for children. To develop a coherent policy toward kinship caregivers, officials must balance the natural strengths of informal, private exchanges among family members with the power of government agencies to provide both resources and oversight. Photographs, figure, tables, and 63 references (Author abstract modified)