The Pew Commission on Children in Foster Care had previously recommended the need to continue and strengthen several existing Federal programs, in particular the Waiver Demonstration Project. Authorized by Congress in 1994, the waivers were to improve foster care by freeing a State’s use of Federal money from some of the restrictions of Titles IV-B and IV-E of the Social Security Act. Initially, States sought the advantage of the waivers. However, they became underutilized thereafter. Even though the Pew Commission described the waivers as successful, their overall success is up for debate. Projects that have demonstrated success have not been replicated as expected. This article presents a historical overview of the Waiver Initiative and its use in funding child welfare demonstration projects. It examines the Federal funding of child welfare services, the restrictions on funding that necessitate States’ use of the waiver for innovative projects, and the requirements for a demonstration project. In addition, it provides an overview of project types approved by the U.S. Department of Health and Human Services (HHS), as well as a summary of the results.