A national study of Canadian hospitals assessed the perceived level and types of competition and the strategies pursued by these hospitals. Questionnaire data were obtained from chief executive officers in 715 hospitals, yielding a national response rate of 68%. Respondents indicated the perceived level of competition in the environment, the content of competition, and stated hospital strategies. Additional data were obtained on market share and hospital type. Close to half of the respondents indicated little or no competition in their environment, while 30% indicated substantial levels of competition. This represents a significant deviation from conventional wisdom about the Canadian health services environment. Respondents in hospitals with more than 75% of the market share were less likely to perceive competition than those with a smaller market share. CEOs in teaching hospitals and in hospitals located in larger communities reported higher levels of competition. Hospitals competed mostly for capital, programs, and staff; about a third of hospitals competed for patients and no differences were found by type of institution. Those hospitals in more competitive environments were more likely to indicate the use of diversification and horizontal integration as organizational strategies.