IN THE MOST RECENT STEP in the trend towards deinstitutionalization of severely mentally ill clients, the Supreme Court's landmark decision on June 22, 1999, ruled that "isolating people with disabilities in big state institutions when there is no medical reason for their confinement is a form of discrimination that violates Federal disabilities law" (New York Times, 1999). The occasion for the decision was a lawsuit brought by two Atlanta women against the state of Georgia, claiming that they were being held in an inpatient setting when they could benefit from residential care, and that their rights under the 1990 Americans with Disabilities Act (ADA) were being violated by the excessive confinement. In addition, as the Times reported, a determined, vocal grassroots movement on behalf of the rights of persons with disabilities has arisen nationwide to support the rights of clients with severe mental illness to live in the community in the least restrictive environments possible (Chamberlin, 1990;Harp, 1990;Tower, 1994). These groups are also active in demanding funding from states to develop residential care. Although there are cutbacks in resources for other forms of mental health care, increased funding is available through The U.S. Department of Housing and Urban Development and other federal and state sources for residential programs for homeless mentally ill clients. For these and a number of other reasons, residential care is seen as critical to the future of mental health services. Social workers are especially suited to direct residential care programs, because the programs use psychosocial rather than medical means of healing (Sullivan, 1992).This paper applies the unique, original psychology, intrapsychic humanism, to offer guidelines that social workers can use for residential program planning and management. The conceptual framework used as the base for the research presented here is the postpositivist heuristic paradigm, with an emphasis on the value of research for advancing human rights (Heineman (Pieper), 1981,