Forty-seven patients in psychogeriatric day centre were analysed regarding use of resources, costs and well-being. The level of well-being was based on interviews with staff and relatives and related to the economic outcome--a cost utility analysis. A 6 month period prior to day care was compared with the first 6 months in such care. The use of resources at home increased by 20% while the use of institutional care was reduced by 22%. Fifty-three percent of the patients improved in their well-being after participation in day care. When the cost of utility analysis was applied, the cost for a well-year was 4293 pounds.