Abstract The responses of institutions to ‘acting out’ in personality disordered individuals may perpetuate such behaviour. Inadvertently, such responses remove the potential for these individuals to learn from experience and to mature psychologically, to individualize. This is because institutions, first and foremost, serve the needs of society. In performing this wider function, they often do not meet, sufficiently, the therapeutic needs of the individual. The result is a stalemate in which both the individual who acts out and the institution continue to suffer. An awareness of the interaction between the individual and the ‘institution’, and particularly an awareness of the often complementary style of their interaction, victim-victimizer, may empower professionals working in institutions to break the therapeutic stalemate. However, to achieve this requires changes in attitudes and behaviour on the part of staff and some restructuring of the internal organization of their institutions so as to influence both staff-staff and staff-patient relationships. We discuss how some principles of Henderson Hospital's democratic therapeutic community model, which helps to avoid some of the pitfalls which otherwise can lead to therapeutic stalemate, can be translated to institutions which of necessity operate at different levels of security and how they may be applied in non-specialist settings.