It failed, even though Democrats tried to get it passed by attaching the DREAM Act to an important defense spending bill. More than two million children and young adults would have been on the path to citizenship had it passed on Tuesday.
Many wore their caps and gowns at a San Francisco rally to support the DREAM Act. Most are in college or have already graduated, like 29-year-old Gabriel. His parents brought him here when he was only 7. Now, he has an engineering degree, but can't work in his field because of his status.
"I am limited to the typical, what they call illegal immigrant work. I can work as a bus boy, I can go mow your lawns and all that," said Gabriel.
The act would have eventually provided citizenship to anyone who arrived in the U.S. as a minor and goes to college or joins the military. However, those opposing the bill claim it would have created another amnesty.
"It's not just allowing a few students, it's opening the doorway, which is like a flood waiting behind it," said tea party member Mario Pellegrini.
Sen. John McCain, R-AZ, argued the borders need to be secured before the DREAM Act is passed. He voted against it.
"Then one, two, five, 10 years from now we will be faced with another generation of young people brought here against their will, who have a compelling story to tell," said McCain.
Eight years ago, California passed a DREAM Act that allowed undocumented students to go to college without having to pay out-of-state tuition. Still, they are not eligible for financial aid or scholarships and that is what Senate Bill 1460 -- also called the DREAM Act -- now wants. The governor will likely veto it.
"Gov. Schwarzenegger has not wanted to extend any more benefits beyond the tuition issue. He is waiting for Congress to do something because he feels this is a federal decision," said USF law professor Bill Ong Hing.
Back in Washington, Senate Democrats promised to reintroduce the DREAM Act, but the chances of it becoming law this year are very slim. Most people believe it will have to wait until after the November elections.