Purpose: The purpose of this study was to examine the effectiveness of a trauma-informed approach that was adapted for psychiatric residential treatment (PRT) for children aged 5-17. Methods: Data were extracted from case files of 100 youths who received traditional PRT and 105 youths who received trauma-informed PRT (TI-PRT). Outcome measures included change in functional impairment, physical restraints and locked seclusion room incidents, length of time in care, and discharge placement type. Results: Results of a repeated measures analysis of variance demonstrated that youth who received TI-PRT experienced greater improvements in functional impairment. Results of a zero-inflated Poisson showed that youth in TI-PRT had fewer seclusion room incidents. Finally, the average length of time in care was significantly shorter for the TI-PRT group. Discussion: The results support trauma-informed PRT as a promising approach for helping youth achieve greater stability in functioning and for addressing issues of long-standing concern in residential care settings.