A prospective study was conducted in a nursing home among elderly residents treated with and without indwelling catheters. Most of the patients were white females with a mean age of 82.3 years. The mortality at 6 months among catheterized patients was 30.2% compared with 10.1% among the noncatheterized groups (P < 0.001). Patients with catheters differed significantly from those without in having more impaired mental status and diminished activities of daily living. They also differed significantly for eight of 30 diseases. Cerebrovascular and hypertensive disease were significantly more common in catheterized patients. In contrast, fractures and musculoskeletal disorders were significantly more common among noncatheterized patients. Catheterized patients had significantly more days with fever and symptomatic urinary tract infections and received antibiotics more often than did noncatheterized patients. We conclude that: (1) direct comparisons of morbidity and mortality among catheterized and noncatheterized populations are not valid because of confounding by the presence of associated life‐threatening illnesses; and (2) catheterized patients have more clinical episodes of urinary tract infections and fever and are treated more frequently with antibiotics.