Dramatic shifts from cash assistance to work, embodied in the 1996 replacement of Aid to Families with Dependent Children with Temporary Assistance for Needy Families (TANF), highlight the need to understand how current cash assistance recipients participate in required work-related activities and obstacles faced in getting and keeping jobs. The 1997 National Survey of America's Families (NSAF) describes recipient work activity and obstacles during early TANF implementation. A larger proportion of TANF recipients participated in work activities in 1997 than in the past. More than 4 out of 10 reported at least 2 significant work obstacles. As states continue to move TANF recipients into jobs, evidence is mixed about whether recipients still receiving TANF will face increasing obstacles to successful moves from welfare to employment. This report describes TANF recipients' participation in work-related activities, notes caseload obstacles and their work-limiting impact, and discusses differences between states. High work-activity levels in 1997 indicate that states should have no trouble meeting total caseload participation targets in the future. However, large numbers of recipients report personal and family characteristics that could present significant challenges to work. States face widely varying challenges in moving their caseloads into work activities. (SM)