A review of the comparative studies on day treatment as an alternative modality to traditional full-time hospitalization reveals impressive evidence of its superior effectiveness in facilitating the adjustment and re-integration of patients into the community. On other measures, such as cost effectiveness, family stress, symptom alleviation and relapse rate, day treatment proves to be on par with full-time hospitalization. The data base pertaining to the efficacy of day treatment as a transitional facility from hospital to community is promising, but much too incomplete to permit conclusive statements. Methodological and conceptual issues in the current research are discussed and recommendations for future studies are offered.