Community mental health centers (CMHCs) have been criticized for directing resources that should be used to treat the seriously mentally ill to the treatment of less impaired patients. Many of the latter group are assigned one of the DSM-III V codes for conditions that do not meet criteria for a mental disorder. This study compared patients with V-code conditions and those with diagnosed mental disorders on clinical, social, and economic variables. V-code patients were significantly less likely to have bad prior care and to rely on third-party payments. They were significantly more likely to have been self-referred or referred by friends or family and to be white, well-educated, female, and married. CMHCs that treated fewer V-code patients reported proportionally more staffhours worked by physicians indicating a greater medical orientation. The authors believe CMHCs should periodically evaluate whether, by serving patients with less serious conditions, they are diverting badly needed resources away from the seriously mentally ill.