U.S. foster care policy prioritizes keeping siblings together while in foster care. However, prior research on the effects of sibling placement is limited in sample, measures, and research design. In this study, we use data on 2,297 children from an urban county in years 2015-2019 and assess how sibling separation is associated with placement instability. We use multilevel parametric hazard modeling with adjustments for child, sibling, and placement characteristics. Findings indicate that children placed with at least one sibling are less likely to experience a placement move and are specifically less likely to experience a non-progress move (e.g., moves due to problems or negative experiences in their foster home). For larger sibling groups, sibling separation was not consistently associated with placement instability and there was little difference in placement instability for children placed with some versus all siblings. Results were robust to differences in measurement and model specification. Black or Hispanic race/ethnicity was also associated with increased risk of instability, and associations between sibling separation and instability were stronger for Black children, implying enhanced efforts to maintain sibling groups may be especially beneficial for Black children. Overall, findings provide support for the continuation and expansion of policies promoting sibling placement.