THIS STUDY ATTEMPTED TO ASSESS CHANGES IN THE BEHAVIOR OF SEVERELY RETARDED CHILDREN AS A RESULT OF SCHOOL ATTENDANCE. THIS IS PHASE II OF A THREE-PART REPORT WHICH COVERS SOCIAL COMPETENCY AND PARENT ADAPTABILITY. THE SUBJECTS WERE PLACED IN AN EXPERIMENTAL GROUP (SCHOOL CHILDREN) AND A CONTROL GROUP (NONSCHOOL CHILDREN). THE SCHOOL CHILDREN ATTENDED SPECIAL CLASSES IN PUBLIC SCHOOL AND INSTITUTIONS, AND THE NONSCHOOL CHILDREN EITHER LIVED AT HOME OR IN INSTITUTIONS. THE SOCIAL COMPETENCY WAS COMPARED BETWEEN THESE CHILDREN, AND THE PARENT ADAPTABILITY WAS COMPARED BETWEEN PARENTS OF SCHOOL CHILDREN AND NONSCHOOL CHILDREN. ALL THE CHILDREN WERE 5 TO 12 YEARS OLD AND HAD IQ'S BETWEEN 25 AND 55. TWO NEW INSTRUMENTS WERE DEVELOPED--(1) THE SAN FRANCISCO SOCIAL COMPETENCY SCALE AND (2) A SCALE FOR PARENT ADAPTABILITY. INFORMATION INCLUDED DATA FROM INTERVIEWS, HOME VISITS, FAMILY CHARACTERISTICS (AGE, EDUCATION, AND INCOME), AND INTELLIGENCE TESTS. THE SOCIAL COMPETENCY SCORES INCLUDED SELF-HELP, INITIATIVE-RESPONSIBILITY, SOCIAL SKILLS, COMMUNICATION, AND FAVORED INSTITUTIONAL CHILDREN, BOTH SCHOOL AND NONSCHOOL. THE PARENT ADAPTABILITY SCORES INCLUDED MOTIVATION, EMPATHY, FLEXIBILITY AND ADAPTABILITY, AND FAVORED THE EXPERIMENTAL GROUP (PARENTS WITH CHILDREN IN SCHOOL). PARENTS OF INSTITUTIONAL CHILDREN WERE NOT GRADED. MORE STUDIES WERE RECOMMENDED. (GC)