Sector-wide approaches (SWAps) in health were developed in the early 1990s in response to widespread dissatisfaction with fragmented donor-sponsored projects and prescriptive adjustment lending. SWAps were intended to provide a more coherent way to articulate and manage government-led sectoral policies and expenditure frameworks and build local institutional capacity as well as offer a means to more effective relationships between governments and donor agencies. The global health landscape has changed dramatically since then. Although many countries have undertaken SWAps, the experience deviated considerably from the early vision, and many of the problems in national health systems persist. SWAps have contributed to the development of robust national health policies and transparent expenditure frameworks as well as strengthening institutional capacity, though the levels of success vary widely. Government stewardship of donors and local stakeholders as well as their political will to implement health strategies also vary highly. Although SWAps are geared towards consensus building policy changes at the national level, in the face of urgent global health concerns, notably the HIV epidemic, donors often by-passed SWAp arrangements through global health initiatives intended to address international priorities. Yet, a key to sustaining global health initiatives is how well they can be integrated into national health systems, a task requiring a return to SWAp principles. Despite shortcomings, SWAps have remained a popular approach for supporting alignment, harmonization and improved accountability between donors and country governments, increasing predictability of aid and reducing fragmentation. The future of SWAps will depend on stronger government oversight and innovative institutional arrangements to support health strategies that address the need for both targeted initiatives and stronger health systems to provide a wide range of public health and clinical services. For development assistance to be more effective, it will also depend on better discipline by donors to support national governments through transparent negotiation.