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Recently, group homes have been adapted as a housing alternative for the elderly with dementia in order to lessen the burden on families as well as to promote the well-being of the dementia victims themselves in many countries. Group homes are usually small scale with a home-like atmosphere creating a therapeutic environment. The purpose of this study was to identify Koreans' perception of fee-based group homes for the elderly with dementia and differences in perception between groups.The survey was conducted through questionnaires collected from 912 respondents currently living in Seoul and five provinces in Korea. The results of the survey were as follows: The respondents thought 1) the merits of group homes included decreasing the loneliness of the elderly, providing an active and stimulating environment, and lessening the emotional and physical burden on the caring families; 2) the demerits included the economic burden on the caring family and the difficulty of finding sites for group homes. A family’s feeling of guilt associated with admitting their parents into group homes was not such a big problem as expected. There were several significant differences in perceptions of fee-based group homes between groups divided by sex, level of education, monthly income, structural type of current dwelling, responsibilities of care, desired living environment for demented elderly and others. Based on the results of this study, it is asserted that group homes for the elderly with dementia would be embraced throughout the country if some associated problems can be solved.