This article discusses the importance of the prevention of homelessness among persons with serious mental illnesses. The authors describe a continuum of residential stability. At the lowest extreme of the continuum are those people who are chronically homeless and alienated from conventional community life -- street people -- who cause the most concern both to the public and to mental health providers because of their high visibility and the frequency with which they display florid psychiatric symptoms. The midrange of the continuum includes many people in which homelessness represents a crisis that can be relatively easily overcome with only a little help. The high end comprises those who have permanent and satisfactory housing. Thus, one indicator of the success of a community mental health service is the extent to which its clients are at, or move toward, the stable end of the continuum. The authors contend that one of the goals of continued research concerning homelessness and mental illness should be to develop a method to identify individuals at risk of homelessness and a set of actions to take when, or before, a housing crisis develops (authors). [abstract]