This article explores social policy developments in the arena of intellectual and developmental disabilities. It begins by summarizing the challenges facing persons with intellectual disabilities and their caregivers in 1945. Families depended on a patchwork of over-crowded and under-funded large state institutions. Children with intellectual disabilities were marginalized from education and public services. Shame and stigma, along with the lack of community-based services, led many parents to institutionalize a child. The federal government provided almost no specific assistance for disabled individuals or to their families. Postwar America provided fertile ground for parents to act collectively through the emergence of the National Association of Retarded Children (NARC). Partly as a consequence of such organizing, the 1950s marked a surprising turning-point, in which the federal government expanded income support to disabled persons through measures such as Social Security's “Disabled Adult Child” program and, by the early 1970s, the advent of Supplemental Security Income (SSI). It also reviews the growth of Medicaid as the dominant payer of medical and social services at the boundaries between personal medical services, case management, education, and other social services. The article ends by summarizing current challenges in intellectual disability policy. It notes that the size, complexity, and expense of I/DD services poses inherent challenges, particularly to state and local governments in the current recession. Adjusting for inflation, 23 states actually reduced real spending on I/DD services between 2008 and 2009. Controlling for local conditions, politically conservative states enacted deeper cuts and spent a smaller fraction of state income on intellectual disability services than other states. © 2012 Wiley Periodicals, Inc. Dev Disabil Res Rev 2011; 17:44–51.