Principles and characteristics of program quality review are described as one means of evaluating values-based outcomes of day programs for persons with mental retardation. Program quality review may be distinguished from other evaluation systems in its focus on program outcomes--what actually happens to the people in the program--rather than on inputs, processes, or outputs. Issues of community presence and participation, good relationships, choice, respect and dignity, competence, and wages and benefits are evaluated as desirable outcomes of day programs. The review process involves a one-day site visit by a four-member team which observes programs in action and conducts both formal and informal interviews. Outcome measures are designed to produce both qualitative and quantitative information, and positive as well as negative feedback is stressed. Results of a pilot implementation of the program quality review system at seven target agencies in Connecticut showed that the system is a useful supplement to other program evaluation systems, including national accreditation. Results of a preliminary survey of 56 clients in both public and private day programs in Connecticut concerning their satisfaction with various program components supported the findings of program quality reviews to date. (JW)