OBJECTIVE: to examine the association between residential status and risk of hip fracture in older people. DESIGN: population-based case-control study. SETTING: Auckland, New Zealand. SUBJECTS: a random sample of all individuals > or = 60 years, hospitalized with a fracture of the proximal femur between July 1991 and February 1994. Controls were age and gender frequency-matched to the cases, randomly selected from a random sample of general practitioners. MAIN OUTCOME MEASURES: radiographically-confirmed fracture of the proximal femur. Fractures sustained as a result of major trauma, such as in a motor vehicle crash, and those associated with pre-existing pathological conditions were excluded. RESULTS: individuals living in institutions were almost four times more likely to sustain a hip fracture [age- and gender-adjusted odds ratio (OR)=3.8; 95% confidence interval (CI): 3.0-4.8] than those living in private homes. After adjustment for potential confounding factors, the risk of hip fracture associated with living in an institution remained significantly increased (P< 0.0001), although the magnitude of the risk was somewhat diminished (OR=2.2; 95% (CI: 1.5-3.5). CONCLUSIONS: living in an institution is associated with an increased risk of hip fracture in older people. Specific factors that place these individuals at increased risk need to be identified, in order to develop intervention strategies.