Objective: The aim of the present study was to map out what kind of psychotropic drugs are prescribed for elderly residents in assisted-living homes and how they relate to age, sex, form of living, psychiatric diagnosis, care needs and mental health status, and to identify factors of importance for their use; and to study the indication for treatment and the evaluation of the effects of treatment. Method: The study had a cross-sectional design and included one-third of all patients (n = 175) living in old-age homes or in nursing homes in a municipality in southern Sweden. Data concerning medication was obtained from medical records and included all psychotropic drugs prescribed the day the study started and the previous month. Need of care was assessed using Katz index, and mental health status was assessed using the Organic Brain Syndrome scale. Results: Of the study population, 128 (73%) used one or more psychoactive drug. Prescribed drugs were neuroleptics (16%), anxiolytics (32%), hypnotics, (45%), and anti-depressants (33%). A greater prescription of neuroleptics than anti-depressants was seen for those showing signs of depression, and caution with prescription of benzodiazepines was seen for those showing signs of dementia. An indication and evaluation of treatment was lacking in half of the cases. Treatment with psychiatric drugs existed for approximately 50% of those without a determined psychiatric diagnosis. Conclusion: We have found a frequent use of neuroleptics, anxiolytics and hypnotics in the elderly, but an underprescription of anti-depressants appears to exist. There is a lack of documentation of indications and evaluations of psychotropic medication.