While competency models have been used for some time by private industry to select and manage appropriate talent, competency-based approaches in education and training, assessment, and development of workers has experienced a more recent emergence.  Simply stated, a competency is a characteristic related to effective and superior performance in a given work role, and a competency model is a visual diagram of approximately seven to nine competencies required of a particular job or occupation or within an industry.  Based on some of the relevant literature, this paper reviews the use of competency models for business needs and preparing the workforce.  Two challenges are discussed when using competency models for selection and appraisal functions.  Specific efforts engaged by the Employment and Training Administration (ETA) are described, noting the consistency of the reviewed literature with the development of the ETA Competency Model Clearinghouse and the investment in the Western Governors University demonstration project.  Future research and pilots and demonstration efforts might expand upon the current investments made within the workforce investment system and among its partners.  Additionally, using competency models to develop training and provide career preparation for targeted populations is also explored.