Objective: The authors' goals were to describe an assertive community treatment program developed for patients in rural South Carolina and to evaluate the effect of the program on rates of hospital utilization and cost of care. Methods: Twenty-three patients with chronic psychotic disorders living in rural areas of South Carolina were assigned to an assertive community treatment program. The patients' average number of days per year in the hospital, length of stay per admission, number of admissions per year, and estimated annual cost of care during the five years before assignment to the program and during a period from four to 26 months after assignment were compared. Results: The intervention was associated with a 79 percent decrease in hospital days per year, a 64 percent decrease in the number of admissions per year, a 75 percent decrease in the average length ofstayper admission, and a 52 percent reduction in estimated direct cost of care. Conclusions: Although the methods of assertive community treatment may need to be modified to suit the travel requirements and other characteristics of rural settings, the study results suggest that the model can be successfully used in rural areas.