BACKGROUND: The Experience of Care Project advocates a form of qualitative research, participant observation, in medical settings with the goals of (1) identifying ways to increase compassion within hospital systems and (2) training students so that they will become more compassionate physicians. METHOD: The Experience of Care Project was started in October 1993 at Penn State University Hospital, The Milton S. Hershey Medical Center. As of December 1995, 108 cases have been investigated by two professors and 18 students from Pennsylvania State University College of Medicine and six students from Elizabeth City State University in Elizabeth City, North Carolina. At the Hershey Medical Center and at a hospital in Elizabeth City, North Carolina, the participant observers accompany patients and their families during hospital stays, in an effort to better understand the experiences and perspectives of patients and families and to provide a collection of computerized narratives that can be used to examine problems in patient care. RESULTS: Three types of patient dilemmas illustrate the concerns frequently reported by observers: problems with (1) information flow, (2) false expectations, and (3) scheduling. The observational data were saturated with examples falling in all three categories, which are not mutually exclusive; similar incidents were witnessed in a variety of locations by many different observers. The students participating in the project used these examples as the basis of class discussions. One finding was the discrepancy between problems noted by observers-often based on complaints the patients and their families directly articulated to the observers- and patients' satisfaction as recorded in standardized questionnaires. In written evaluations, the students claimed that the project gave them significant insights into the nature of patient care. CONCLUSION: The Experience of Care Project has created a collection of computerized narratives about patients that suggest ways for increasing compassion and communication within hospital systems. Many concerns could be alleviated through programs that enhance patient participation and education. Participant observation can serve as a useful training tool to accomplish the goal of emphasizing humane care within medical education.