Some children are being put at risk due to the significant pressures faced by residential care centres and foster care services.
A review carried out by the Health Information and Quality Authority (HIQA) identifies staff shortages, a lack of adequate training in some cases and a "lack of urgency" by the HSE in investigating allegations made against foster carers.
HIQA found that in some cases children continued to live in foster homes where a complaint had been upheld against an adult.
Its review looked at inspections carried out on 33 residential centres and eight HSE foster services last year.
Overall, it said children are safe and there are examples of high-quality social work practice, but challenges exist.
The review found that some children did not have social workers assigned to them or that some lived with unapproved carers.
It said the residential centre system is under significant pressure due to staff shortages and not all staff who were reviewed had up-to-date garda vetting.
HIQA said not all staff had proper fire training and staff and young people did not participate in fire drills to a satisfactory level.
While it found that foster carers offered good quality care in a safe environment, it notes "with concern" a lack of urgency by the HSE when it came to investigating certain allegations made against foster carers.
In general, the investigation of allegations was slow.
Some children continued to live in homes where complaints had been upheld against adults, while foster carers were offered very little training in dealing with vulnerable children.
It said social workers were less able to provide assistance to foster carers due to staff shortages and much of this support was provided over the phone, meaning supervision was less "robust".
HIQA said a proactive national strategy is now needed in order to meet the needs of children and young people.
The head of an advocacy group for young people in care has called on the Government to lift the embargo on public recruitment to allow more social workers to be recruited in the areas of childcare and fostering.
Speaking to RTE News, Empowering People in Care Director Jennifer Gargan said HSE and Government objectives to improve fostering services were pointless if there were not enough staff to implement the planned reforms.
Ms Gargan said EPIC was concerned over the lack of social workers.
She said that the lack of resources was a major issue in relation to deficiencies that have emerged in child care and fostering care in particular.