In 1990 the Robert Wood Johnson Foundation's Mental Health Services Program for Youth awarded grants to eight state-community partnerships to develop systems of care for mentally ill children and adolescents. The authors describe approaches to system building in the program's first two years of implementation. The evolving systems consist of government agencies in child welfare, mental health, public health, education, and juvenile justice, as well as private-sector health and mental health care providers. Basic system features include interagency steering committees and long-term intensive case management. Fundamental principles guiding system development are individualization of care to meet the needs of the specific child, organization of care to empower families to manage care over the long term, flexible financing of care, and normalization of care in family and community settings.