Purpose: The aim of this study was to compare the activities of daily living, mental status, and life satisfaction of elderly persons living in home with those in institutions and to investigate the factors influencing life satisfaction and mental health. Methods: Data was collected through interview with persons over 60 years of age in a nursing home and in a community elderly center in Daegu City and Kyoungsang buk-do. Subjects were included 32 persons in the nursing home and 41 persons in the community elderly center. Data collection was undertaken 11 - 22 September 2007. Results: Elderly persons living at home showed higher dependency in instrumental activities of daily living, lower cognitive function, higher depression, and higher life satisfaction than elderly persons living in institution. The two groups were significantly different in this regard. Conclusion: As the age of the general population advances, we must prioritize quality of life in elderly persons by undertaking depression prevention through various means.