Nineteen units have been established to provide care and treatment for patients who do not require maximum-security hospital placements yet cannot be placed in open psychiatric hospitals. These units vary widely in their organization and processes used. The case study focused on Grange Lodge, a 15-bed facility based in Leicester. The unit is staffed by a multidisciplinary clinical team including psychiatrists, nurses, clinical psychologist, social worker, occupational therapist, and physical therapist. The study used the Correctional Institutions Environment Scale (CIES), an 86-item instrument. Data were gathered immediately before the unit opened and 6 months after the opening. Twenty-five of 28 staff members completed the questionnaire in the first stage and 20 of 26 in the second stage. Ten of 10 patients completed the questionnaire in the second stage. Profiles of staff expectations were compared with those of staff of two prisons. Findings showed with those of staff of two prisons. Findings showed that security requirements were not regarded as restricting psychiatric nurses' functions to that of custodians. Over 90 percent of the staff agreed that patients need positive encouragement and that therapeutic personal relationships between staff and patients need to be developed. Disagreement existed over rules and sanctions, flexibility and clarity of routine, and other areas. Staff perceptions did not change substantially over time, although their evaluations became slightly less positive. Patient and staff profiles were generally similar. Figures, a table, and 18 references are supplied.