Development of Community Mental Health Centers has revealed the need for more effective administrative mechanisms for planning, developing, and controlling mental health services and for involving effectively the local community in this process. The public health model of primary, secondary, and tertiary prevention was used as a basis for planning and developing mental health services in two settings. The resulting organizations proved effective in providing qualitative mental health services and in developing effective work groups throughout the organization to take responsibility for program. Experience with this model supports specialization of state hospitals into rehabilitation facilities and their close integration with programs in the communities they serve. It is proposed that this will require state hospital programs becoming the responsibility of local communities.