In different parts of the world, family is considered the main responsible for ensuring children the full enjoyment of their rights; also, family is recognized as the central core for children’s development. Even so, in exceptional situations, children need to be separated from their biological family. In those cases, alternative care is required. This study investigates two different types of alternative care: institutional care and family foster care. The aim of this paper is to review the existing literature on child development of children in those types of alternative care. The review was done through different scientific data base: Science Direct, SciELO, Redalyc, PubMed, DialNet y Academic Google, and using the following key words: “desarrollo infantile”, “familias de acogida temporal”, “institucionalización”, “child development”, “temporary family foster care”, “residential care”. With reference to the studies about temporary family foster care, the ones considered were those that made reference to family systems that took temporary care of a child until their judicial situation was solved. These were external families that have no bonds with the child. Those studies in which the families were pre-adoptive ones were not considered. Fifty-eight articles, published in the last seventeen years (from 2000 to 2017), were chosen. From this total, nineteen correspond to systematic revisions, four are reports from children organizations, while the remaining thirty-five correspond to empiric studies. The results of this paper are organized in two different sections: the first one makes reference to the conditions of life at an institution and the child development under these conditions, whereas the second one makes reference to temporary family foster care programs and the child development after the inclusion in these programs. As regards the first section, it is concluded that the institutional care shows the lack of an exclusive and stable affect figure, being the children exposed to unstable rotating caregivers with consistent bond disruption. These caregivers are described as unavailable to the children with minimal emotional and physical contact. Furthermore, the caregivers show lack of empathy and little responsiveness to child’s individual needs resulting in chronic emotional deprivation. At the same time, the above mentioned is closely related to the delays or difficulties that the development of these institutionalized children show in different areas: cognitive, intellectual, academic, socio-affective, emotional, physical-motor, cerebral and neurological. In the second section of the paper, the results of the studies on children development in temporary family foster care are described and the countries where evidence on these programs was found are presented. They show that there are significant and beneficial physical, emotional, socio-affective, behavioral, cognitive and intellectual changes in the development of institutionalized children after they enter temporary family foster care. Moreover, the development of children living in alternative care differs significantly from the one of those living with family foster care. The results also specify the characteristics that a temporary family foster care must have in order to facilitate the child’s development. It is concluded that children in institutional care show delays and maladaptation in various domains of development. Besides, the longer the child is institutionalized, the more his behavior is affected. The authors believe that these institutions are not the right places to raise children during a long period of time and they propose the need to prioritize temporary family foster care. The results underline the importance of family foster care programs as an alternative that could improve children´s development. Nevertheless, institutional care is still the predominant alternative worldwide for children without parental care. Finally, this systematic review aims to be a starting point for future research. The aspects that need to be deepen are highlighted.