PURPOSE The study examined factors associated with state variations in the use of federal and state civil money penalties (CMPs) for nursing homes. DESIGN AND METHODS We collected federal and state CMP data from state survey and certification agencies for 2004. We also used federal CMP data from the federal enforcement action database for 2000-2004. Logistic regressions examined factors related to whether states issued CMPs, and ordinary least squares regressions examined the number and amount of federal CMPs (2000-2004) and the total federal and state CMPs (2004). RESULTS In 2004, 3,159 federal and state CMPs were collected, for a total of $21.6 million, but CMPs were given for only 2% of deficiencies issued. The number of federal CMPs collected was positively related to average facility occupancy rates, the percentage of facilities with deficiencies for harm or jeopardy, and state survey and certification budgets but was negatively related to the number of facility complaints per nursing home bed. Total federal and state CMPs were positively related to state senators' liberal voting records, having a democratic governor, and the percentage of Medicaid nursing home residents and were negatively related to the population aged 65 and older, complaints per nursing home bed, percentage of hospital-based facilities, and home- and community-based expenditures. IMPLICATIONS The Centers for Medicare & Medicaid Services should address the state variations in CMPs by providing states and federal regional offices with guidelines on the use of federal CMPs. It should also improve accuracy and completeness by including federal and state CMPs in its enforcement database.