This booklet describes the progress being made in the transition from individual impact evaluations (IE) studies to building a systematic approach to identifying, implementing and using evaluations at sector and national levels, whereby IE is seen as an important budgetary planning, policy formulation, management and accountability tool. The institutionalization of IE has been achieved in a relatively small number of developing countries, mainly in Latin America;however, many countries have already started or expressed interest in the process of institutionalization. This paper reviews this experience in order to draw lessons on the benefits of an institutionalized approach to IE, the conditions that favour it, the challenges limiting progress, and some of the important steps in the process of developing such an approach.