Family group homes took 'care' of children after their removal from their parents and before they had been placed in a foster home. Children in transit between homes also went to family group homes. The homes provided emergency care for children who were neglected or in danger of becoming neglected because they could not be cared for in their own home, for instance if the mother was in hospital. These homes were also used when the relationship between a child and parents had broken down and some respite time was needed. Prior to their establishment, children could be placed in institutions if they required temporary care.

In 1990, the Annual Report of the Department of Community Services decribed the function of family group homes as:

enabling children to live in a family home for short term periods, prior to either returning to their own families or until an alternative long term home is arranged for them, such as foster parents

In a family group home, a married couple cared for up to six children in a large family residence.

Many former receiving home keepers became family group carers.

Family group homes were situated throughout Tasmania.

In 1982, the Social Welfare Department had 19 family group homes. It closed Lismore and Miroma, leaving 17. By 1989, it had 18 homes.