The study included the entire Jewish male population referred by Israel's juvenile court to residential treatment between 1969 and 1975. During this period, 2,050 juveniles were sentenced to residential treatment. Due to errors in identification numbers, criminal records of only 1,331 (64.9 percent) were retrieved. Mean age at first confinement was 13.45 years, while mean length of stay in institutions was 19.7 months. Since juvenile delinquents referred to community-based, nonresidential treatment programs could not serve as controls due to different treatment needs and methods, no controls were assessed. However, the study included subjects who were placed in all available residential treatment facilities in Israel and evaluated them by the same measurements. Findings clearly indicated that incarceration in Israeli residential treatment facilities did not increase the level of juvenile delinquency. In fact, the level of juvenile delinquency dropped dramatically during the first year after discharge, in comparison to pretreatment and treatment rates. Postdischarge juvenile delinquency increased slightly by the end of the third year of followup, but the level was still significantly lower than that prior to institutionalization. Results are discussed in terms of the educational/treatment approach in Israel's residential treatment facilities that stresses inmate needs and rehabilitative goals. 56 references, 2 tables, and 1 figure