We examine the effects of Title I on school behavior, resources, and academic performance using a rich set of school finance and student-level achievement data from one large urban school district using a regression discontinuity design. We find that Title I eligibility raises Federal revenues of schools by about $460 per student. This is partially offset by decreases in revenues from state categorical aid grants, so that the net increase to schools is about $360 per student. We find no impact on overall school-level test scores, but also no impact among the subgroups of students most likely to be affected by Title I. A novel finding is that schools appear to respond to the incentives embedded in the Title I allocation process by manipulating the fraction of their students signed up for free lunch to secure more Federal funds. (Contains 1 table and 10 figures.)