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This paper analyses the role played by US economic assistance during the administrations of Jânio Quadros and João Goulart in Brazil (1961–4). It focuses on the negotiation and implementation of financial agreements associated with the Alliance for Progress, President Kennedy's aid programme for Latin America. It demonstrates that the Alliance had a positive impact during Quadros' administration, providing substantial resources to the country and placing economic growth ahead of economic stabilisation as the principal criterion for aid. Circumstances changed, however, when João Goulart became president, resulting in serious funding constraints. The paper suggests that the main reason for this was political, specifically regarding Washington's perception of Goulart's links with communist groups. [ABSTRACT FROM PUBLISHER]