Family instability is a key dimension of social inequality in the United States. Child maltreatment is one context in which changes to a child’s care and living arrangements, introduced when a child is placed in foster care, could actively improve a child’s wellbeing. In this study, I analyze a nationally representative sample of child welfare-involved youth to examine whether the association between foster care and instability in care and living arrangements is driven by children’s placement in foster care or by the selectivity of foster youth. I find that compared to children who do not enter foster care, those who do are more likely to experience change in their primary caregiver, availability of a secondary caregiver, and their living arrangement. When I treat the initial transition into foster care as necessary, excluding it from my measures of change, foster care appears to stabilize the structures of children’s care arrangements, while their constitutive relationships remain substantially less so. In addition to answering an important question about the experiences of child welfare-involved youth, this study contributes to the more central situation of “institutionalized” family life—including that shaped by the child welfare system—in broader scholarship and dialogue on childhood and family diversity, instability, and inequality.