Although home-care of Alzheimer's disease (AD) patients is more cost-effective than institutionalization, there is limited knowledge concerning the causes and prevention of institutionalization. The goal of this project was to determine the circumstances related to institutionalization of AD patients and to determine if a family counseling program can reduce these precipitating factors. In Study 1, we surveyed 109 family members of institutionalized AD patients. Primary precipitating factors included difficulties with patient behavior, insufficient auxiliary help and respite, financial difficulties, and caregiver emotional and physical complaints. In Study 2 we evaluated the effectiveness of an enhanced counseling program which included specific intervention techniques to cope with precipitating factors. For 41 AD family members who were seriously contemplating institutionalization, the precipitating factors prior to counseling were similar to those found in Study 1. After six months of individual counseling, home visits, and participation in caregiver support groups, there was only one placement, and a consistent reduction in the precipitating factors. These preliminary results suggest that a specially designed counseling program may delay or forestall institutionalization.