According to a definition by the World Health Organization, old age is divided into three groups depending on chronological age. The first group are the elderly aged between 60 and 75, followed by the elderly aged between 76 and 90, and by the elderly older than 90. The rise in the number of the elderly (above 65 years of age), and especially those older than 80, brings about a higher disability level as a consequence of chronic illnesses. The result of this is a sharp rise in the demand for institutional care. The institutions offer necessary nursing and care to their users for 24 hours a day. The aim of this paper is to give an overview of the organization and financing of institutional care in particular European countries. Descriptions of institutional care in Croatia, Germany, Austria, Sweden and Greece are given in this paper, based on the literature review. Institutional care is distinguished in different countries by the available capacities, by the organization of care for the elderly and by the ways of financing. Most institutional care systems are partially financed by the country with various types of financial aid, and by the additional payment of the user or his family. In the developed countries, such as Austria, Sweden and Germany, there is higher number of individuals who make use of institutional care because of the decline of traditional families, in which women are not employed and care for the elderly family members. In Mediterranean countries, such as Greece, traditionalism is still present in the care for the elderly, since only 0.6% of them reside in care institutions. Besides a few drawbacks, institutional care still plays a major role in caring for the elderly and is a great relief for families who need to take care of their elderly members.