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A rigorous 6-year evaluation of transitional employment services indicates that the services can substantially increase the employment and earnings of Supplemental Security Income (SSI) recipients who have mental retardation. The evaluation examined the Social Security Administration's Transitional Employment Training Demonstration, which operated from 1985 to 1987. Our estimates indicate the demonstration services raised the average employment and earnings levels for mentally retarded SSI recipients who were offered the services. Furthermore, the estimates show that these increases persisted relatively undiminished over the 6 years after recipients entered the demonstration. Because average SSI payments for the group fell only slightly during the 6 years, the participants' average income rose. The rise in income, together with increases in work activity and community integration, suggests that the overall well-being of the participants increased because of the services. Our evaluation also suggests that transitional employment services benefit society as a whole because the earnings gains combined with the likely cost savings from reduced use of other services exceed the costs of the transitional employment services.