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A review of legal provisions and practices and current psychological theory and research concerning the mentally retarded indicated inconsistencies between the law and current theory, Laws have been based on archaic models which fail to consider the heterogeneity of those classified as retarded and their potential for development and training. Retardation professionals have agreed that normalization of institutionalized mentally retarded and mainstreaming in education are preferable principles. Research comparing the effects of community living and institutionalization and effects of special and integrated classes was sparse and inconclusive; the major thrust of research has been on the 4% of all mentally retarded who are institutionalized. Legal attitudes toward the retarded have changed only in the area of institutionalization, particularly guaranteeing due process during commitment. Litigation has been involved in habilitation and the least restrictive alternative, the legal counterparts to normalization. Courts have relied on constitutional, statutory, tort and contract theories and deal mainly with the institutionalized retarded. Laws imposed on the non-institutionalized retarded have demonstrated a particularly restrictive parens patriae attitude. Cases have been inconsistent, resulting in no clear standard as yet. A more recent trend has been on legislation which is more consistent than litigation. Recommendations based on theory and research and status of present laws included the following: 1) more emphasis on research of retarded in the community, on community living versus institutionalization, and on special education versus integrated, mainstreamed classes; 2) development of national standards incorporating the principle of normalization and a developmental approach to services; re-evaluation and amendment of present laws to expand the rights of non-institutionalized and 4) adoption of legislation giving all mentally retarded a right to habilitation, establishing a committee to develop and revise minimum standards, creation of a monitoring team to periodically review each patient's treatment plan and formulation of a manual setting forth minimum treatment levels.