* Increasing demand on public hospital beds has led to what many see as a hospital bed crisis requiring substantial increases in bed numbers. By 2050, if current bed use trends persist and as the numbers of frail older patients rise exponentially, a 62% increase in hospital beds will be required to meet expected demand, at a cost almost equal to the entire current Australian healthcare budget. * This article provides an overview of the effectiveness of different strategies for reducing hospital demand that may be viewed as primarily (although not exclusively) targeting the hospital sector - increasing capacity and throughput and reducing readmissions - or the non-hospital sector - facilitating early discharge or reducing presentations and admissions to hospital. Evidence of effectiveness was retrieved from a literature search of randomised trials and observational studies using broad search terms. * The principal findings were as follows: (1) within the hospital sector, throughput could be substantially improved by outsourcing public hospital clinical services to the private sector, undertaking whole-of-hospital reform of care processes and patient flow that address both access and exit block, separating acute from elective beds and services, increasing rates of day-only or short stay admissions, and curtailing ineffective or marginally effective clinical interventions; (2) in regards to the non-hospital sector, potentially the biggest gains in reducing hospital demand will come from improved access to residential care, rehabilitation services, and domiciliary support as patients awaiting such services currently account for 70% of acute hospital bed-days. More widespread use of acute care and advance care planning within residential care facilities and population-based chronic disease management programs can also assist. * This overview concludes that, in reducing hospital bed demand, clinical process redesign within hospitals and capacity enhancement of non-hospital care services and chronic disease management programs are effective strategies that should be considered before investing heavily in creating additional hospital beds devoid of any critical reappraisal of current models of care.