Using a sample of new dementia admissions who entered selected nursing facilities December 1992 through June 1994, this paper compares special care dementia units (SCUs) to non-specialized (traditional) nursing home care in their effectiveness in reducing physically aggressive behaviors within six-months of placement. Findings indicate that SCUs admit younger and more highly aggressive residents. Our results indicate that when differences in age and baseline levels of disruptive behaviors are controlled, SCU placement showed no positive or negative effect on the frequency of aggressive behaviors. Rather than SCU placement, it was the increased use of psychotropic medications and the reduction in the use of physical restraints that showed a relationship with lower levels of physically aggressive behaviors. While SCUs do not appear to be the hoped for panacea with regard to reducing physically aggressive behaviors, they still appear to serve a useful function within the broader context of the provision of services for residents with dementia within the nursing home.