This paper provides an analysis of the current status of the states' eligibility policies for children with disabilities, ages 3 through 5. The study of all states and the District of Columbia indicated that states have made substantial progress toward developing eligibility policy since the passage of Public Law 99-457, the 1986 Amendments to the Education of the Handicapped Act. Content analysis of states' policy documents indicated that states use three types of approaches in determining eligibility: categorical (N=20); non-categorical (N=6); and a combination of categorical and non-categorical (N=25). Policy analysis revealed four main approaches to delineating eligibility criteria: (1) use of criteria for each disability category (N=20); (2) use of quantitative criteria only (N=15); (3) use of professional judgment only (N=4); and (4) use of a combination of professional judgment or quantitative criteria (N=12). When using quantitative criteria, states varied as to the type of quantitative criteria used and the level of criteria. Differences also existed in whether states required the child to be delayed in either one or more than one area of development. Analysis suggests that many states have developed policies that may either over-identify or under-identify preschool children eligible for special education and related services. Includes 39 references. (DB)