The study described in this paper used data from two national samples of families with children to describe the home environments in which welfare children are being raised and to identify the children's health, learning, and behavior problems. The study compared children whose families had received Aid to Families with Dependent Children (AFDC) payments in the previous 12 months with children in families that were neither poor nor welfare dependent, and with children in poor families that had not received AFDC payments in the last year. Results indicated that: (1) children in families that received AFDC payments were less healthy, more likely to fail in school, and more likely to exhibit discipline problems than children in nonpoor families; (2) approximately one-third of children in families that had received AFDC payments received intellectual stimulation and emotional support from their parents that was comparable to that received by children in nonpoor families or families that had not received AFDC payments; and (3) children in families that had not received AFDC payments were six times as likely to lack insurance coverage as children in families that had received AFDC payments. A 50-item reference list and tables of data are provided. Appendices include a summary of the data analysis and a description of data sources. (ME)