This paper uses the 1995 and 2002 waves of the National Survey of Family Growth to examine recent trends in cohabitation in the United States. We find increases in both the prevalence and duration of unmarried cohabitation. Cohabitation continues to transform children's family lives, as children are increasingly born to cohabiting mothers (18% during 1997-2001) or later experience their mother's entry into a cohabiting union. Consequently, we estimate that two-fifths of all children spend some time in a cohabiting family by age 12. Because of substantial missing data in the 2002 NSFG, we are unable to produce new estimates of divorce or of children's time in single-parent families. Nonetheless, our results point to the steady growth of cohabitation and to the evolving role of cohabitation in U.S. family life.