This paper describes the ‘rural guardianship network’ method of managing persons with severe mental illnesses and reports on a retrospective case–control study that compares the outcome of 561 schizophrenic patients from townships with guardianship networks to that of 103 schizophrenic patients from a township without guardianship networks. Each patient enrolled in a guardianship network is assigned a guardian – usually a family member – who ensures that the patient takes medication and gets medical follow-up, and reports any changes in the patient's condition to the village health worker or the township doctor who is responsible for psychiatric care. These guardians are supported and supervised by management groups at the village and township levels composed of government officials, medical administrators, physicians from township hospitals, and village health workers. Compared with patients who are not enrolled in guardianship networks, enrolled patients have significantly lower rates of hospital admission, lower rates of socially disruptive behaviour, and lower levels of psychopathological symptoms. The rural guardianship network is an effective and economical means of providing close supervision of mentally ill patients in their homes.