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Background: quality ratings of care homes are used by decision makers in the absence of direct information about outcomes. However, there is little evidence about the relationship between regulators' ratings of homes and residents' quality of life outcomes. Objectives: to capture social care-related quality of life (SCRQoL) outcomes for residents and investigate the relationship between outcomes and regulator quality ratings of homes. Methods: data were collected for 366 residents of 83 English care homes for older people inspected during 2008. Outcomes were measured using the Adult Social Care Outcomes Toolkit (ASCOT). Multivariate multilevel modelling was used to investigate the relationship between quality of life outcomes and star ratings of homes, controlling for resident and home characteristics. Results: care homes were delivering substantial gains in SCRQoL, but were more successful in delivering ‘basic’ (e.g. personal cleanliness) than higher-order domains (e.g. social participation). Outcomes were associated with quality ratings of residential homes but not of nursing homes. Conclusions: the approach to providing quality ratings by the regulator in England is currently under review. Future quality indicators need to demonstrate their relationship with quality of life outcomes if they are to be a reliable guide to commissioners and private individuals purchasing care.