The core concept of living learning is the acquisition of knowledge by clients and staff about the forces affecting personal and organizational development problems. Thus, mental health and education are merged through democratic participation in applied social research. Learning merged with participation in program development is therapeutic because it reduces anxiety by enabling individuals to meet challenges in their social environments with competence. This problem-centered learning method requires participation of both clients and staff in the determination of goals, in the clarification of problems and methods of solving them, and in the implementation of institutional change. The learning experience is facilitated by maximizing learners' participation in developing their own programs. Experimental work with police officers and with offenders is cited as evidence that lower echelon staff and consumers of institutional services can be converted from perceived liabilities to effective assets in the process of social change. Similar applied social research has also been conducted successfully by local researchers in community mental health programs. Major adjustment problems of clients in postinstitutional settings can be addressed through a sharing of reentry program responsibilities between the inmates and the nonconfined prison employees. More effective social control should result from merging the development of offenders' personal mores with their participation in the development of community mores. Eighteen references are provided.