Purpose: The subjective psychological experience of people with moderate to severe dementia living in residential care is insufficiently understood. In the present study we aimed to explore the subjective experience of life with dementia in residential care from the perspective of the person with dementia, and to understand the psychological impact of being in this situation. Design and Methods: This was an exploratory qualitative study. Eighty individuals with dementia who were living in residential care homes engaged in unstructured conversations with a researcher. We subjected the transcripts of the resultant 304 conversations to interpretative phenomenological analysis in order to develop a thematic account. Results: The experience of living with dementia in residential care was fundamentally one of experiencing difficult and distressing emotions relating to loss, isolation, uncertainty, fear, and a sense of worthlessness. Participants generally tried to cope by accepting and making the best of things and affirming their past sense of self and identity, but some also expressed frustration and anger. Implications: Participants were able to describe aspects of their situation and their emotional response to it, grounded in a strong retained sense of self and identity. The participants' experience emphasizes the importance of improving the living situation of elders with dementia in residential care settings.