Over the past decade, researchers have documented the range of needs and devised new methods for increasing our understanding of the homeless severely mentally ill population. Clinicians have developed an appreciation of the difficulty and complexity of effectively treating this population, and policymakers have become increasingly aware of the barriers to developing services and housing. In this article, the progress-to-date in research, the evolution of new service approaches, and the development of federal, state, and local policies to meet the needs of homeless mentally ill individuals are assessed. The many challenges that remain are also considered.