The US government has shut down due to a lack of funding. The Republican-controlled Senate had until midnight (5am UK time) to pass a spending bill, but they needed the Democrats to support it.
Republicans only have 51 seats in the 100-member chamber. They needed 60 votes to pass the package. Both sides are blaming each other for the stalemate.
Why can they not agree?
Democrats are demanding help for "Dreamers", more than 700,000 immigrants who entered the US illegally as children.
Last year Mr Trump ordered the Obama-era Deferred Action for Childhood Arrivals (DACA) programme, which shielded Dreamers from deportation, to end in March.
Republicans have tried to persuade Democrats to back their bill by offering a six-year extension to the Children's Health Insurance Program (CHIP), which benefits lower-income families.
WATCH LIVE: U.S. Senate votes on the verge of a government shutdown
US government in shutdown after Senate fails to pass new budget
As the US government shuts down, Sky News' US Correspondent Cordelia Lynch explains the reasons for the deadlock and how it could affect America.
A shutdown is looking increasingly possible. After a closed-door meeting with President Trump, Democratic leader Senator Schumer said: "We made some progress, but we still have a good number of disagreements. The discussions will continue."
Senate Minority Leader Chuck Schumer (D-NY) returns to the U.S. Capitol after meeting with U.S. President Donald Trump on the looming threat of a federal government shutdown January 19, 2018, in Washington, DC. Congress continues to…
:: Which services will be affected?
Hundreds of thousands of US government defense workers, park rangers and business regulators could be temporarily out of work.
Vital services will still be provided by law enforcement, immigration officers, the central bank, veterans' hospitals and the military.
But a large number of civilians in both departments, including about three-quarters of the roughly 740,000 civilians who work for the Pentagon, will stay home.
White HouseAccording to the current plan, national parks, and museums will remain open.
:: What does President Trump say?
The president caused confusion on Thursday morning when he tweeted: "CHIP should be part of a long-term solution, not a 30 Day, or short-term, extension!".
His tweet appeared to contradict his own party's strategy. A White House spokesperson then issued a clarification stating that Mr. Trump did actually support the House measure.
At the Pentagon, the President told reporters the government "could very well" shut down. He warned that the consequences of a shutdown would be "devastating".
Has it happened before?
Unless a deal is reached the US Government could shut down
Yes. During the two-week shutdown in October 2013, around 800,000 workers were granted leave.
This time, the American Federation of Government Employees estimates about 850,000 workers, out of a total 3.5 million, could be told to stay home without pay until Congress reaches an agreement.
:: How could it be resolved?
The Democrats could capitulate, but that currently seems unlikely. Republicans could shame them into a deal by focusing on the offer to extend the children's health programme. Alternatively, the Republicans could shift their position on DACA or at least make some more concessions.
The US government has started to shut down after Congress failed to overcome a bitter standoff over spending and immigration, marking a chaotic end to Donald Trump's first year as president.
Last-minute negotiations crumbled as Senate Democrats blocked a four-week stopgap extension in a late-night vote, causing the fourth government shutdown in a quarter of a century.
Social Security and most other safety net programmes are unaffected by the lapse in federal spending authority. Critical government functions will continue, with uniformed service members, health inspectors and law enforcement officers set to work without pay. But if no deal is brokered before Monday, two million federal employees will be furloughed – given leave of absence.
Most staff in the departments of housing, environment, education, and commerce will stay at home. Half of the workers in the treasury, health, defense and transportation departments will also not be going to work next week.
National parks and monuments face closure while visa and passport processing could be delayed.
Essential services that protect "life or human property" will continue, including national security, postal services, air traffic control, inpatient medical services, emergency outpatient medicine, disaster assistance, prisons, taxation, and electricity generation.
Congress scheduled an unusual Saturday session to begin considering a three-week version of the short-term spending measure - and to broadcast that they were at work as the shutdown commenced. It seemed likely each side would try forcing votes aimed at making the other party look culpable for shuttering federal agencies.
White House blames Democrats
After hours of closed-door meetings and phone calls, the Senate scheduled its late-night vote on a House-passed plan. It gained 50 votes to proceed to 48 against, but 60 were needed to break a Democratic filibuster.
The president watched the results from the White House residence, dialing up allies and affirming his belief that Democrats would take the blame for the shutdown, a source familiar with his conversations said.
"Tonight, they put politics above our national security, military families, vulnerable children, and our country's ability to serve all Americans.
"We will not negotiate the status of unlawful immigrants while Democrats hold our lawful citizen's hostage over their reckless demands," she said.
Schumer hits back
Mr. Schumer fought back, however, blaming the president for leading him to believe a deal was possible on a measure to prevent the expulsion of undocumented migrants who arrived in the country as children.
"Every American knows the Republican Party controls White House, the Senate, the House - it is their job to keep the government open. It is their job to work with us to move forward," Mr. Schumer told the Senate.