This study aimed to investigate what settings provided desirable physical environments for elderly residential facilities. Information was retrieved from MEDLINE, the Japana Centra Revno Medicina and the Internet, and the articles were investigated. From this review, important concepts regarding physical environments and layouts based on prior research or experience were determined. Important concepts are goals of set up, living units, setting of tables and chairs, interior design, kitchen equipment, sensory stimulation, orientation, safety, private rooms, space organization, psychological environment. Our review of the literature indicated that some problems appear to currently exist within the environments of elderly residential facilities in Japan. We also identified subjects important for further examination, including the methods for setting up day rooms in large spaces, and how to incorporate cultural styling into a room setup.