Day-care has long been a controversial aspect of social policy in countries such as the U.K. What evidence is there about the effects of out-of-home day-care on educational, health and welfare outcomes for children and their families? This paper applies to day-care studies, the methodology of the systematic review as pioneered in the health care field, in order to establish the evidence-base for day-care provision. Randomised controlled trials of day-care for pre-school children were identified using electronic databases, hand searches of relevant literature and contacts with authors. A total of 8 trials were identified after examining 920 abstracts and 19 books. All the trials were carried out in the U.S.A. European research on this topic is extensive but we did not identify any studies using trial design. Instead observational, case controlled and cohort studies were prominent. The trials were assessed for methodological quality. Results showed that day-care promotes children's intelligence, development and school achievement. Long-term follow up demonstrates increased employment, lower teenage pregnancy rates, higher socio-economic status and decreased criminal behaviour. There are positive effects on mothers' education, employment and interaction with children. Effects on fathers have not been examined. Few studies look at a range of outcomes spanning the health, education and welfare domains. Most of the trials combined non-parental day-care with some element of parent training or education (mostly targeted at mothers); they did not disentangle the possible effects of these two interventions. The trials had other significant methodological weaknesses, pointing to the importance of improving on study design in this field. There is a need for well designed research on day-care to provide an evidence-base for British social policy.