A system of state courts existed before the Constitution was drafted. There was considerable controversy among the delegates to the Constitutional Convention as to whether a federal court system was needed, and whether it should supplant the state courts. As in other matters under debate, a compromise was reached in which the state courts were continued while the Constitution mandated a federal judiciary with limited power. Article III of the Constitution states the basis for the federal court system:

The judicial power of the United States shall be vested in one Supreme Court, and such inferior courts as the Congress may from time to time ordain and establish.

With this guide, the first Congress divided the nation into districts and created federal courts for each district. From that beginning has evolved the present structure: the Supreme Court, 11 courts of appeals, 91 district courts, and three courts of special jurisdiction. Congress today retains the power to create and abolish federal courts, as well as to determine the number of judges in the federal judiciary system. It cannot, however, abolish the Supreme Court.

The judicial power extends to cases arising under the Constitution; laws and treaties of the United States; admiralty and maritime cases; cases affecting ambassadors, ministers and consuls of foreign countries in the United States; controversies in which the U.S. government is a party; and controversies between states (or their citizens) and foreign nations (or their citizens or subjects). The 11th Amendment removed from federal jurisdiction cases in which citizens of one state were the plaintiffs and the government of another state was the defendant. It did not disturb federal jurisdiction in cases in which a state government is a plaintiff and a citizen of another state the defendant.

The power of the federal courts extends both to civil actions for damages and other redress, and to criminal cases arising under federal law. Article III has resulted in a complex set of relationships between state and federal courts. Ordinarily, federal courts do not hear cases arising under the laws of individual states. However, some cases over which federal courts have jurisdiction may also be heard and decided by state courts. Both court systems thus have exclusive jurisdiction in some areas and concurrent jurisdiction in others.

The Constitution safeguards judicial independence by providing that federal judges shall hold office "during good behavior" -- in practice, until they die, retire or resign, although a judge who commits an offense while in office may be impeached in the same way as the president or other officials of the federal government. U.S. judges are appointed by the president and confirmed by the Senate. Congress also determines the pay scale of judges.

The Supreme Court is the highest court of the United States, and the only one specifically created by the Constitution. A decision of the Supreme Court cannot be appealed to any other court. Congress has the power to fix the number of judges sitting on the Court and, within limits, decide what kind of cases it may hear, but it cannot change the powers given to the Supreme Court by the Constitution itself.

The Constitution is silent on the qualifications for judges. There is no requirement that judges be lawyers, although, in fact, all federal judges and Supreme Court justices have been members of the bar.

Since the creation of the Supreme Court almost 200 years ago, there have been slightly more than 100 justices. The original Court consisted of a chief justice and five associate justices. For the next 80 years, the number of justices varied until, in 1869, the complement was fixed at one chief justice and eight associates. The chief justice is the executive officer of the Court but, in deciding cases, has only one vote, as do the associate justices.

The Supreme Court has original jurisdiction in only two kinds of cases: those involving foreign dignitaries and those in which a state is a party. All other cases reach the Court on appeal from lower courts.

Of the several thousand cases filed annually, the Court usually hears only about 150. Most of the cases involve interpretation of the law or of the intent of Congress in passing a piece of legislation. A significant amount of the work of the Supreme Court, however, consists of determining whether legislation or executive acts conform to the Constitution. This power of judicial review is not specifically provided for by the Constitution. Rather, it is doctrine inferred by the Court from its reading of the Constitution, and forcefully stated in the landmark Marbury vs. Madison case of 1803. In its decision in that case, the Court held that "a legislative act contrary to the Constitution is not law," and further observed that "it is emphatically the province and duty of the judicial department to say what the law is." The doctrine has also been extended to cover the activities of state and local governments.

Decisions of the Court need not be unanimous; a simple majority prevails, provided at least six justices -- the legal quorum -- participate in the decision. In split decisions, the Court usually issues a majority and a minority -- or dissenting -- opinion, both of which may form the basis for future decisions by the Court. Often justices will write separate concurring opinions when they agree with a decision, but for reasons other than those cited by the majority.

The second highest level of the federal judiciary is made up of the courts of appeals, created in 1891 to facilitate the disposition of cases and ease the burden on the Supreme Court. The United States is divided into 11 separate appeals regions, each served by a court of appeals with from three to 15 sitting judges.

The courts of appeals review decisions of the district courts (trial courts with federal jurisdiction) within their areas. They are also empowered to review orders of the independent regulatory agencies, such as the Federal Trade Commission, in cases where the internal review mechanisms of the agencies have been exhausted and there still exists substantial disagreement over legal points.

Below the courts of appeals are the district courts. The 50 states are divided into 89 districts so that litigants may have a trial within easy reach. Additionally, there is one in the District of Columbia and one in the Commonwealth of Puerto Rico, not a state of the union, but part of the United States. From one to 27 judges sit in each of the district courts. Depending on case load, a judge from one district may temporarily sit in another district. Congress fixes the boundaries of the districts according to population, size and volume of work. Some of the smaller states constitute a district by themselves, while the larger states, such as New York, California and Texas, have four districts each.

Except in the District of Columbia, judges must be residents of the district in which they permanently serve. District courts hold their sessions at periodic intervals in different cities of the district.

Most cases and controversies heard by these courts involve federal offenses such as misuse of the mails, theft of federal property, and violations of pure food, banking and counterfeiting laws. These are the only federal courts where grand juries indict those accused of crimes, and juries decide the cases.

In addition to the federal courts of general jurisdiction, it has been necessary from time to time to set up courts for special purposes. These are known as "legislative" courts because they were created by congressional action. Judges in these courts, like their peers in other federal courts, are appointed for life terms by the president, with Senate approval.

Perhaps the most important of these special courts is the Court of Claims, established in 1855 to render judgment on monetary claims against the United States. Other special courts include the Customs Court, which has exclusive jurisdiction over civil actions involving taxes or quotas on imported goods, and the Court of Customs and Patent Appeals which hears appellate motions from decisions of the Customs Court and the U.S. Patent Office.