Federal courts have limited jurisdiction (as opposed to the general jurisdiction of state courts)*. Limited jurisdiction means that the federal courts only have the jurisdiction affirmatively granted to them. Who grants this jurisdiction? Well, federal subject matter jurisdiction requires two things: constitutional authority and congressional authorization to use that authority. Specifically, the constitutional authority comes from Article III of the United States Constitution and the congressional authorization comes from statutes that are passed by Congress. In order to have original subject matter jurisdiction, a federal district court must meet BOTH requirements.
Federal courts hear two types of cases:
1) Federal question cases or cases that “arise under” some federal law and
2) Diversity cases where the parties are from different states and the case in controversy exceeds $75,000.
*Note: Because state courts have general jurisdiction they are presumed to have jurisdiction over all subjects unless some statutory or constitutional provision deprives them of jurisdiction