Federal laws have had a major influence on foster care and child welfare policy for more than 40 years. Additional reforms are needed to ensure safe and stable families for children in care. A number of Federal policies addressing issues such as housing, health care, welfare, social security benefits, taxes, and foster care reimbursement to the States, form the Federal foster care policy framework. The Adoption and Safe Families Act significantly altered Federal foster care policy by instituting key changes such as defining when it is reasonable to pursue family reunification, expediting timelines for making permanency decisions, recognizing kinship care as a permanency option, and providing incentives to the State for increasing the number of adoptions. Courts play a key and often overlooked role in achieving safety and permanency for children in foster care. Efforts to improve court performance have focused on increasing the responsiveness and capacity of courts. Policy recommendations that are needed to improve the lives of children in foster care include increasing investments in children and families, re-directing funding incentives, addressing service gaps, and enhancing accountability. Specific changes should include funding for Program Improvement Grants to States that are committed to achieving the goals in their Program Improvement Plans; a requirement that States document the steps they are taking with increased funds to improve outcomes for children; incentive for States to develop improved administration data systems to track the movement of children in and out of care; and external review bodies in the States. 101 endnotes, appendix