The guardianship of children has its most recent legal roots in British common law, but the concept extends back to the Roman Empire when it was understood that parents had a natural and a legal responsibility to support their children and that their extended family also must support its members. In feudal times, English common law deemed a child's father his or her legal guardian. Upon the death of the father, guardianship reverted to either the mother, if she held no property, or the feudal lord. The courts were deemed to have a vested interest over not only the child, but also any land that the child might inherit.   As a result, they were responsible for appointing appropriate guardians.

Guardianship was well established in United States law long before adoption law.  State courts have long had the authority to appoint guardians for orphaned children with property.   In 1935, Hasseltine Taylor laid the foundation for broader use of guardianship when she advocated for legal guardianship for all children, not only those with property who did not have the protection of parents, including children placed with relative and non-relative foster parents. In the mid-1940s, the US Children’s Bureau issued a report that recommended that procedures be developed for finding and reporting children who lacked the protection of their parents so that new guardians could be appointed for them.   State law continued to evolve and in keeping with Taylor’s and the Children’s Bureau recommendations, guardianship became legally recognized for children who were dependent, abused, or neglect with “public guardianship” placed with agency administrators, probation officers and state departments.

The Adoption Assistance and Child Welfare Act of 1980 (P.L. 96-272) recognized legal guardianship as a permanency option for children and youth in foster care.  This law did not provide for ongoing federal financial support to legal guardians as it did for families who adopted, and most states found it difficult to provide financial assistance to guardians solely with state or local funds.  Some financial assistance was available to guardianship families through the Aid to Families with Dependent Children (AFDC) program but the level of support was far less than the assistance guardians received as foster parents.   As a result, legal guardianship was not frequently used as a permanency option for children in foster care.  Over the time period 1998 through 2010, only between 2% and 7% of all children exiting foster care left to guardianship families each year.  

Throughout the 1980s and 1990s, however, attention began to focus on guardianship as more and more children in foster care were being cared for by kin.  Carol Williams, as associate commissioner of the Children’s Bureau endorsed the concept of guardianship as a permanency option when adoption was inappropriate or unavailable as a permanency option.   She and others recognized that access to guardianship subsidies, along with post-guardianship services, would likely be necessary to support successful guardianships.  Throughout the 1990s, virtually every “blue ribbon” committee convened on the subject of kinship foster care supported the concept of subsidized guardianship.  In 1997, Congress enacted the Adoption and Safe Families Act (ASFA) which once again recognized legal guardianship as a permanency option.   Like P.L. 96-272, ASFA did not address the need for financial assistance to support guardianship families.  Nonetheless, in the 1990s and early 2000s, the Children’s Bureau provided waivers to implement subsidized guardianship demonstration programs.  Among the initial states that received waiver authority, only the state of Illinois had a sufficiently large sample size and rigorous experimental design to fully evaluate its demonstration project and it found that statistically greater rates of reunification for the group of children who were provided services to support reunification, adoption and guardianship compared to children who were provided services to support reunification and adoption only.  These results were later also found in subsequent waiver demonstration evaluations in Wisconsin and Tennessee.  Drawing on these results, the bi-partisan Pew Commission on Children in Foster Care included as a key recommendation in its final report that Congress provide federal guardianship assistance to all children who leave foster care to live with permanent, legal guardian.  The child welfare advocacy community organized to bring the findings of the waiver demonstration evaluations and the Pew Commission recommendations fully into the policy arena.

In 2008, Congress enacted The Fostering Connections to Success and Increasing Adoptions Act (P.L. 110-351) which gives states the option of obtaining federal reimbursement for ongoing assistance payments made on behalf of children who exit foster care to guardianship with a relative.  The Act provides that children must reside with the prospective relative for at least six consecutive months and be eligible for IV-E payments while in the relative's home and that it is determined that "being returned home or adopted are not appropriate permanency options for the child."   According to the Act, the amount of a kinship guardianship assistance payment "shall not exceed the foster care payment which would have been paid on behalf of the child if the child remained in a foster family home."  The Act also stipulates that any youth age 14 or older be consulted before being placed in the kinship guardianship arrangement.  Children receiving federal kinship guardianship assistance are categorically eligible for Medicaid coverage.