Research and policy scholars have suggested that recent welfare caseload reductions have coincided with welfare reform efforts; however, few studies have incorporated the impacts of the Earned Income Tax Credit (EITC) expansions in the 1990s. Using annual state-level administrative data, the author estimated the effects of the fully phased-in federal EITC and state supplemental EITCs on welfare caseload reductions between 1994 and 2000, controlling for the economy, welfare and related policy, demographic and political variables, and other unobservable effects. Results show that both an increase of the federal EITC subsidy rate and the adoption of state EITCs are associated with greater reductions in welfare caseloads, holding all other variables constant. The effects of changes in the work-enforcing welfare policies on caseloads are also estimated. A description of policy implications and research priorities concludes this article.