A day hospital program for patients with mental illness and substance abuse problems at a Veterans Affairs medical center uses nonconfrontational group therapy as the primary treatment modality. The goals of the six-to-eight-week program are to reduce substance abuse, improve medication compliance, and reduce the number of hospitalizations. Aftercare is available for patients who complete the program. The authors suggest that patients' ability to relate well to others in group therapy is the primary factor influencing successful outcome. During a 30-month period, 66 percent of the patients admitted to the day hospital program completed it. Three cases illustrating the variable outcomes of patients treated in the program are presented.