The Priority Funding Areas (PFAs) policy, enacted in Maryland in 1997, is a famous case of smart growth strategies for alleviating urban sprawl. However, its practical effect remains debatable. To verify it, this study investigates the trend of urban sprawl in Maryland during 2000-2019 using the Weighted Urban Proliferation (WUP) indicator. The result shows that the urban sprawl in Maryland is still apparent. Also, the sprawl trend of areas in PFAs is not statistically different from that of non-PFAs. Therefore, the effectiveness of the policy in restraining urban sprawl cannot simply be attributed to the designation of PFAs. Broader socio-economic and political factors can also influence it. The study recommends stronger intergovernmental coordination, targeted financial incentives, adaptive zoning, and comprehensive monitoring systems to enhance effectiveness. Maryland’s experience underscores the importance of flexible, context-sensitive strategies for sustainable urban development.