Objective. We ask whether individual and local factors known to influence reliance on welfare continue to be important under the TANF program, and if such factors differentially affect exit from TANF for African Americans and whites.

Methods. We use monthly administrative data on TANF recipients from October 1996 to July 2004 from the Mississippi Department of Human Services. These data are linked to local economic, social, and spatial characteristics to estimate discrete time hazard models of TANF exit.

Results. Personal barriers to work (e.g., low education and children) and limited economic and social opportunities in communities reduce the likelihood of leaving TANF. The results show that African-American exits from TANF are more influenced by human capital and local economic, social, and spatial conditions than are whites' TANF exits.

Conclusion. The work-first initiative under TANF is most viable where individual barriers to work are limited and economic opportunities and community support to become self-sufficient exist for all people.