Purpose: Literature on institutionalization of patients with dementia has not considered the role of caregivers' quality of care, which encompasses caregivers' exemplary care (EC) behaviors and caregivers' potentially harmful behaviors (PHBs) toward care recipients. This study sought to understand the role of quality of care in mediating between caregiving stressors and caregiver desire to institutionalize (DTI) a patient with dementia. Design and Methods: A sample of 612 family caregivers from diverse racial/ethnic backgrounds was drawn from the baseline data of the Resources for Enhancing Alzheimer's Caregiver Heath (REACH II) project. Multiple mediator models were run using Preacher and Hayes asymptotic and resampling strategies to assess direct and indirect effects of caregiver stressors (daily care bother, behavioral bother, and burden) on caregiver desire to institutionalize a patient with dementia. Results: Overall, PHB was positively related to caregiver desire to institutionalize their care recipients. Specifically, PHB was found to mediate the relationship between caregiving stressors and DTI in the Caucasian and Latino groups, whereas only the mediation effect of EC was significant in the African American group. Implications: Caregivers' perceptions of quality of care helped explain their desire to institutionalize their care recipients with dementia. Including assessment of EC and PHB in clinical and social service settings is recommended for all ethnic groups. Interventions should facilitate EC behaviors among African American caregivers and address concerns of PHBs in Caucasian and Latino caregivers.