We examined the impact of setting characteristics and presentation effects on engagement with stimuli in a group of 193 nursing home residents with dementia (recruited from a total of seven nursing homes). Engagement was assessed through systematic observations using the Observational Measurement of Engagement (OME), and data pertaining to setting characteristics (background noise, light, and number of persons in proximity) were recorded via the environmental portion of the Agitation Behavior Mapping Inventory (ABMI; Cohen-Mansfield, Werner, & Marx, (1989). An observational study of agitation in agitated nursing home residents. International Psychogeriatrics, 1, 153-165). Results revealed that study participants were engaged more often with moderate levels of sound and in the presence of a small group of people (from four to nine people). As to the presentation effects, multiple presentations of the same stimulus were found to be appropriate for the severely impaired as well as the moderately cognitively impaired. Moreover, modeling of the appropriate behavior significantly increased engagement, with the severely cognitively impaired residents receiving the greatest benefit from modeling. These findings have direct implications for the way in which caregivers could structure the environment in the nursing home and how they could present stimuli to residents in order to optimize engagement in persons with dementia.