During the past 10 years researchers studying children adopted from Romanian orphanages have had the opportunity to revisit developmental questions regarding the impact of early deprivation on child development. In the present paper the effects of deprivation are examined by reviewing both the early and more recent literature on studies of children who spent the first few years of life in institutions. Special attention is given to the Canadian study of Romanian adoptees in which the author has been involved. Findings across time and studies are consistent in showing the negative impact of institutionalization on all aspects of children's development (intellectual, physical, behavioral, and social–emotional). Results of studies show, however, that institutionalization, although a risk factor for less optimal development, does not doom a child to psychopathology. However, the impact of institutionalization is greater when coupled with risk factors in the postinstitutional environment. Methodological and conceptual difficulties in research with institutionalized samples of children are discussed and future directions for research are considered.