In spite of many political decisions on implementation, deinstitutionalization has hardly been started in The Netherlands, in contrast to Great Britain and the United States. The principal condition for deinstitutionalization, `continuity of care', has to be found in the bringing together of community mental health services with intramural facilities (so-called `multifunctional units'). The day hospital-inn model in connection with a comprehensive system of sheltered living arrangements of the Massachusetts Mental Health Center in Boston forms a unique combination of community mental health elements and intramural services, by which continuity of care can be offered. The history, design and evaluation of this frequently praised project will be described and discussed on the basis of the publications concerning this project and of a study on the spot.