In November 2005 the US Department of Labor's Employment and Training Administration announced a bold new initiativeöWorkforce Innovations in Regional Economic Development (known as WIRED). In its first iteration the WIRED initiative awarded thirteen three-year regional planning and development grants to assist regions in integrating their workforce and economic development systems to better serve emerging technologies and high employment growth sectors. In this paper I discuss the WIRED initiative as a model for federal involvement in regional economic development. Despite a sound basis in regional development theory, the implementation of WIRED fell short of its original goals that, in many cases, stymied regional attempts at innovation. The difficulties experienced by first-generation WIRED recipients led to a stark revision of the federal WIRED concept and a reversion to more traditional workforce development approaches. To be truly effective, future federal endeavors in regional economic development must overcome the persistent institutional divisions, legal impediments, and political pressures that work contrary to the desired goal of a flexible and competitive regional development strategy.