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Objectives. This study investigates the process of aging in place in assisted living facilities (ALFs) and seeks to gain an in-depth understanding of the factors influencing this phenomenon in a variety of ALF contexts. Methods. Qualitative methods were used to study five ALFs for 1 year. Data collection methods included participant observation; informal and in-depth interviewing of providers, residents, and residents' families; and review of resident and facility records. Analysis was conducted using the grounded theory approach. Results. The ability of residents to remain in assisted living was principally a function of the &;dquo;fit” between the capacity of both residents and facilities to manage decline. Multiple community, facility, and resident factors influenced the capacity to manage decline, and resident—facility fit was both an outcome and an influence on the decline management process. Resident and facility risk also was an intervening factor and a consequence of decline management. Discussion. Findings point out the complexity of aging in place in ALFs and the need for a coordinated effort by facilities, residents, and families in the management of resident decline. Findings further highlight the necessity of residents being well informed about both their own needs and the capacity of a facility to meet them. [ABSTRACT FROM AUTHOR]