The Court turns a new furrow in the field of diversity jurisdiction today and, in so doing, plows under a rule of almost a quarter of a century’s standing — the rule that in determining jurisdiction, “the sum claimed by the plaintiff controls if the claim is apparently made in good faith.” St. Paul Indemnity Co. v. Red Cab Co., 303 U. S. 283, 288 (1938). Here the respondent Insurance Company filed suit “to set aside” an award of $1,050 given Horton by the Texas Industrial Accident Board. The Court, instead of testing the jurisdictional amount by this sum, looks instead to allegations of the Insurance Company that Horton, the defendant in the action, “will claim the sum *356of [$14,035] . . . (Emphasis added.) This is the first time the Court has let a plaintiff affix jurisdiction by prophesying what the defendant would or might claim, rather than by stating what the plaintiff itself did claim. In so generously construing the statute, the Court confounds the test heretofore applied in diversity cases. It also nullifies the result of “years of study by the United States Judicial Conference and the Administrative Office of the United States Courts, as well as by the Congress/’ ante, p. 351, in the adoption of the Act of July 25,1958, 72 Stat. 415, increasing the jurisdictional amount in diversity cases to $10,000. Once again the United States District Courts in Texas will be flooded by compensation cases,1 and the Congress once again will be obliged to amend the diversity statute. Moreover, today’s decision practically wipes out the long-existing distinction between declaratory judgment actions and conventional suits. See 28 U. S. C. § 2201. For these reasons I must dissent.
Petitioner, an injured workman, filed a claim under the Texas Workmen’s Compensation Act before the Texas Industrial Accident Board for the maximum allowable recovery, $14,035 (401 weeks at $35 per week). The Board, after a hearing, awarded petitioner $1,050 ($35 per week for 30 weeks). Within hours of the award, respondent, the compensation insurer, literally raced into Federal District Court and filed suit to set aside the Board’s decision. The diversity action was brought pursuant to Vernon’s Tex. Ann. Civ. Stat., Art. 8307, § 5, which allows the issues to be determined “upon trial de novo, [where] . . . the burden or [sic] proof shall be upon the party claiming compensation.” Upon petitioner’s motion, the District Court dismissed the action for lack of jurisdiction. The Court of Appeals reversed.
*357The jurisdictional limits of Federal District Courts are bounded on one side by the Constitution and on the other by the enactments of Congress. Only that judicial power expressly granted by statute may be exercised by the nisi prius courts. Lockerty v. Phillips, 319 U. S. 182 (1943); Kline v. Burke Construction Co., 260 U. S. 226 (1922); Sheldon v. Sill, 8 How. 441 (1850). In the light of such history, this Court has repeatedly held that such jurisdiction is to be narrowly interpreted. “The policy of the [diversity] statute calls for its strict construction.” Healy v. Ratta, 292 U. S. 263, 270 (1934). See Indianapolis v. Chase National Bank, 314 U. S. 63 (1941); St. Paul Indemnity Co. v. Red Cab Co., supra.
The argument that the federal court, in diversity cases, is just another state court is inapposite here. As the Court points out, the determination of whether a case comes within the jurisdiction of a District Court “is a federal question to be decided under federal standards.” Ante, p. 352. The jurisdictional statute, “which is nationwide in its operation, was intended to be uniform in its application, unaffected by local law definition or characterization of the subject matter to which it is to be applied.” Shamrock Oil Corp. v. Sheets, 313 U. S. 100, 104 (1941). Regardless of the method used by the Texas courts to determine the jurisdictional amounts for such cases, we must scrupulously apply the standard set by Congress for federal courts.
The statute conferring jurisdiction on District Courts in suits between parties of diverse citizenship limits it to those actions “where the matter in controversy exceeds the sum or value of $10,000, exclusive of interest and costs . . . .” 28 U. S. C. § 1332 (a). In most cases, the determination of the amount in controversy is exceedingly simple, e. g., liquidated damages. However, where the relief sought is difficult to define in terms of money, or is of differing value to the parties, the statute does not admit *358of ready application. To clarify these situations, this Court, in St. Paul Indemnity Co. v. Red Cab Co., supra, at 288, stated: “[U]nless the law gives a different rule, the sum claimed by the plaintiff controls if the claim is apparently made in good faith.” (Emphasis added.)
The application of the foregoing rules to the problem here results in a simple solution. At the time respondent filed its complaint, there was enforceable against it a liability in the amount of $1,050. If petitioner defaulted, the District Court would set aside the Board award. If respondent lost and petitioner filed no counterclaim, the judgment could only be for $1,050. It was only if petitioner counterclaimed for an amount in excess of the jurisdictional amount of $10,000, that respondent could have controverted a claim cognizable in federal court. It seems impossible to avoid the conclusion that the Court is allowing diversity jurisdiction to be predicated upon a counterclaim which .might possibly be filed by petitioner. Even a “disclaimer or surrender of [a] ... part of the original claim” would not change the Court's insistence upon looking to the alleged counterclaim if that were more than the respondent’s claim, for the jurisdictional minimum. Apparently the Court would require a “denial of these allegations” that petitioner will claim an amount in excess of the jurisdictional limit before considering the respondent’s prayer to set aside the Board’s award as the source of the jurisdictional amount. Ante, p. 353. Not only is this in patent conflict with St. Paul Indemnity Co. v. Red Cab Co., supra, but it distorts the meaning of Rule 3, Federal Rules of Civil Procedure, which states, “[a] civil action is commenced by filing a complaint with the court.” Here the Court evidently holds that if the complaint, insufficient to meet the jurisdictional standards, alleges that a possible compulsory counterclaim, sufficient to meet such standards, may be filed by the defendant, federal jurisdiction attaches. Certainly *359we have never permitted a District Court to acquire jurisdiction under 28 U. S. C. § 1331 (a) 2 where the plaintiff does not allege a federal question but claims that the defendant will raise such an issue. “[Wjhether a case is one [involving a federal question] . . . must be determined from what necessarily appears in the plaintiff’s statement of his own claim in the bill or declaration, unaided by anything alleged in anticipation of avoidance of defenses which it is thought the defendant may interpose.” Taylor v. Anderson, 234 U. S. 74, 75-76 (1914). (Emphasis added.) See Skelly Oil Co. v. Phillips Petroleum Co., 339 U. S. 667 (1950); First National Bank v. Williams, 252 U. S. 504 (1920); Louisville & N. R. Co. v. Mottley, 211 U. S. 149 (1908). To allow such a procedure in diversity cases is to unbalance the entire jurisdictional pattern.
In essence, the Court has permitted respondent to turn its suit into an action for a declaratory judgment without meeting the requirements of the Declaratory Judgment Act. 28 U. S. C. § 2201. That Act provides that “[i]n a case of actual controversy within its jurisdiction . . . any court of the United States, upon the filing of an appropriate pleading, may declare the rights and other legal relations of any interested party seeking such declaration . . . (Emphasis added.)
The complaint filed in the District Court was not styled a declaratory judgment action, and it did not seek such relief. More importantly, respondent has succeeded in avoiding the element of discretion permitted by the statute. See Brillhart v. Excess Ins. Co., 316 U. S. 491 (1942). Declaratory relief is a procedural remedy and, therefore, the construction of the Act is a federal matter. *360See Aetna Life Ins. Co. v. Haworth, 300 U. S. 227 (1937). Whether or not such relief should be granted does not depend upon whether the state courts would exercise their discretion to grant a declaratory judgment in the same situation.3 Differing factors are pertinent to the discretionary decisions of the two separate judicial systems, state and federal. In the latter system, discretionary refusal to entertain the action frequently occurs when the suit involves a state statute, such as the one here. See Federation of Labor v. McAdory, 325 U. S. 450 (1945). Moreover, it is even questionable whether respondent has satisfied the jurisdictional amount requirement for such actions. See Travelers Ins. Co. v. Greenfield, 154 F. 2d 950; New York Life Ins. Co. v. Greenfield, 154 F. 2d 953; Commercial Casualty Ins. Co. v. Fowles, 154 F. 2d 884; Mutual Life Ins. Co. v. Moyle, 116 F. 2d 434. That the Declaratory Judgment Act in no way affects the jurisdictional requirements for federal courts is clear. “To sanction suits for declaratory relief as within the jurisdiction of the District Courts merely because . . . artful pleading anticipates a defense based on federal law would contravene the whole trend of jurisdictional legislation by Congress, disregard the effective functioning of the federal judicial system and distort the limited procedural purpose of the Declaratory Judgment Act.” Skelly Oil Co. v. Phillips Petroleum Co., supra, at 673-674.
*361Finally, today’s decision effectively emasculates the recent congressional attempt to limit diversity jurisdiction, especially in workmen’s compensation cases. In order to decrease “the workload of the Federal courts,” which “has greatly increased because of the removal of workmen’s compensation cases from the State courts to the Federal courts,” the Judicial Conference of the United States urged the passage of the current legislation. S. Rep. No. 1830, 85th Cong., 2d Sess. 7. Workmen’s compensation cases were singled out and specifically dealt with because they “arise and exist only by virtue of State laws. No Federal question is involved and no law of the United States is involved in these cases.” Id., at 8. To accomplish the desired result of restricting federal diversity jurisdiction, Congress raised the minimum jurisdictional amount from $3,000 to $10,000. Corporations were deemed citizens of more than one State and removal of workmen’s compensation cases to federal courts was forbidden.
To further limit the number of diversity cases, the Congress enacted 28 U. S. C. § 1332 (b), which provides that
“where the plaintiff who files the case originally in the Federal courts is finally adjudged to be entitled to recover less than the sum or value of $10,000, computed without regard to any . . . counterclaim to which the defendant may be adjudged to be entitled, . . . the district court . . . may impose costs on the plaintiff.” (Emphasis added.)
This provision makes little sense when applied to the result now approved by the Court. If respondent were to obtain the relief it sought, namely, to have the Board’s award of less than $10,000 “vacated, set aside, voided and declared to be of no further force and effect,” it is clear that costs could be assessed against it under § 1332 (b). This produces an anomalous situation which the Court *362must implicitly approve. Respondent has no hope of avoiding possible liability under the cost sanction of § 1332 (b). This is so because the relief it obtains must be measured against the jurisdictional minimum “without regard” for Horton’s possible counterclaim. We are therefore left with the strange result that while respondent has met the requirements of § 1332 (a), yet under § 1332 (b) it will be liable for costs for failing to meet the same requirements.
Moreover, the Senate Report expressed concern for the problems of the injured employee in federal court,
“[S]ome of these State [workmen’s compensation] statutes limit the venue to the place where the accident occurred or to the district of the workman’s residence. When removed to the Federal court the venue provisions of the State statute cannot be applied. Very often cases removed to the Federal courts require the workman to travel long distances and to bring his witnesses at great expense. This places an undue burden upon the workman and very often the workman settles his claim because he cannot afford the luxury of a trial in Federal court.” S. Rep. No. 1830, 85th Cong., 2d Sess. 9.
While 28 U. S. C. § 1332 does not specifically prohibit the filing of original workmen’s compensation cases, a clearer expression of congressional dislike for saddling federal courts with such cases could hardly be imagined. We should, therefore, give effect to this policy wherever possible. Not only does the decision today fail to do this, but the Court goes out of its way to defeat the congressional intent. The statement that “the workman has the option to file his case in either the Federal or the State court,” S. Rep. No. 1830, 85th Cong., 2d Sess. 9, is no longer correct. It is now an unequal race to the courthouse door — a race which the insurers will invariably win, *363since they have resident counsel in Austin (the location of the Texas Industrial Accident Board) who quickly secure news of Board awards and are thus enabled to “beat” the workman in the choice of forums. Thus, the Court— contrary to the specifically expressed intention of the Congress — grants the insurance companies the option of going into federal court, with all its attendant difficulties to the already overburdened federal judiciary and the impecunious workman. We thought differently in 1957, when we refused to “read legislation with a jaundiced eye,” saying that “it will not do for us to tell the Congress ‘We see what you were driving at but you did not use choice words to describe your purpose.’ ” United States v. Union Pacific R. Co., 353 U. S. 112, 118. Congress closed the back door and locked it tight in 1958, only to have the Court break down the front door today and hang out the welcome sign.
In 1957, 2,147 workmen’s compensation cases were commenced in the United States District Courts of Texas. S. Rep. No. 1830, 85th Cong., 2d Sess. 8.
“The district courts shall have original jurisdiction of all civil actions wherein the matter in controversy exceeds the sum or value of $10,000 exclusive of interest and costs, and arises under the Constitution, laws, or treaties of the United States.”
The argument that the suit here is not really one to set aside the Board award (because the moment it was filed that award was voided and the suit is, in reality, a new proceeding in which the workman must establish liability), when coupled with the result here, leads to the total abandonment of the rule of St. Paul Indemnity Co. v. Red Cab Co., 303 U. S. 283 (1938). It would permit jurisdiction to be established by the plaintiff’s allegation that at some prior time the defendant had claimed, even if only extrajudicially, an amount equal to the jurisdictional minimum.