The number of children living in institutions is staggering. Existing knowledge of individual and group dynamics in insti tutional treatment is not being applied. Children must not be pushed from one foster home to another before being placed in an institution. Institutional placement must cease to be con sidered "a last resort"; it must be recognized as an appropriate treatment situation for certain children. Institutions must em phasize the living situation as much as clinical services and must provide for treatment and healthy growth development.