This qualitative longitudinal study documents the experiences of 60 people who are homeless and mentally ill from their state mental hospital discharge through their first two years in community housing. The study explores the personal, cultural, and environmental contexts of life for adults who are homeless and mentally ill and examines the interaction between an individual's needs and community resources. The research identifies forces that perpetuate homelessness and traces the struggles that people who are homeless and mentally ill encounter during the transition from the streets to stable housing. The findings describe a culturally based pattern of mutual avoidance between homeless mentally ill clients and caregivers, which limits delivery of services to the population. Recommendations include development of alternative systems of care delivery, expansion of educational experiences with underserved populations, and increased funding for service or research with people who are homeless and mentally ill.