Taiwan is facing a rapid change in the composition of its population. As the population ages, a greater demand for long-term care services and, in particular, nursing homes is expected. Before deciding who really needs nursing home care, it is important for policy makers to understand the current pattern of utilisation and what factors are associated with entry. This research assesses the relative importance of predisposing, enabling and need factors that lie behind this. It is based on a survey of elderly people in registered nursing homes, a comparison with a national sample of elderly people in their own homes and interviews with the lucid elderly patients (i.e. could communicate with no problems) and their carers. It was found that nursing home entry was associated with advanced age, gender, educational level and dependency levels of elderly people. After controlling for age, need factors have the greatest impact on admission. Specific medical problems such as cardiovascular, neurological and skeletal muscular diseases were also major contributors. Although most elderly people in Taiwan are cared for in their own homes by their families, under certain circumstances entry to a nursing home seemed inevitable. Decisions about nursing home entry were mainly taken within a family context with adult children being the main players while professionals played a relatively minimal role.