This monograph provides a philosophical framework and practical ideas for improving service delivery to children of color who are severely emotionally disturbed. The monograph targets four sociocultural groups (African Americans, Asian Americans, Hispanic Americans, and Native Americans). The document emphasizes the cultural strengths inherent in all cultures and examines how the system of care can more effectively deal with cultural differences and related treatment issues. In dealing with cultural differences, there is a need to clarify policy, training, resources, practice, and research issues, and cultural competence should be viewed as a developmental process. Five elements contributing to a system's, institution's, or agency's ability to become more culturally competent are identified: value diversity, cultural self-assessment, consciousness of the dynamics of cultural interaction, institutionalization of cultural knowledge, and development of adaptations to diversity.