Young foster children undergo an early separation from their caregiver(s) and often experience severe stress before placement. However, a considerable part of the children do not show apparent signs of distress, making it difficult for the foster carer to be aware of the amount of stress in their foster child. Potential evidence for using salivary cortisol levels as a dimension to evaluate the amount of stress in young foster children is reviewed. Moreover, the applicability of salivary cortisol in the evaluation of stress-reducing interventions for young foster children is discussed. A systematic review was performed using the databases Medline, Psychinfo, Embase, Ebscohost, and Academic Search Premier. Nine studies were traced in which salivary cortisol was used to measure stress in children placed in family foster care or in adoptive families. Stress in general but also neglect, early loss of a caregiver, a younger age at first placement, and a higher number of placements were associated with an altered hypothalamic-pituitary-adrenal (HPA) axis function in foster children. Moreover, four studies on the effect of stress-reducing interventions on HPA-axis functioning of young foster children were found. These studies suggest that caregiver-based interventions can actually help to normalize the HPA-axis function in foster children, and that such changes co-occur with improved behavioral functioning. Although the results from the papers discussed in this review suggest that diurnal cortisol with a wake up and a bedtime measurement may be a relevant tool to evaluate stress in young foster children, this cannot yet be concluded from the present studies, because statistical data from the studies on foster care and adoption in this review were not robust and researchers used different methods to collect the salivary cortisol. Still, it is noteworthy that all studies did find the same pattern of reduced levels in relation to chronic stress (caused by maltreatment and neglect of the child).