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To understand the impact of adding a medical step-down unit (SDU) on patient outcomes and throughput in a medical intensive care unit (ICU).Retrospective cohort study.Two academic tertiary care hospitals within the same health-care system.Adults admitted to the medical ICU at either the control or intervention hospital from October 2013 to March 2014 (preintervention) and October 2014 to March 2015 (postintervention).Opening a 4-bed medical SDU at the intervention hospital on April 1, 2014.Using standard summary statistics, we compared patients across hospitals. Using a difference-in-differences approach, we quantified the association of opening an SDU and outcomes (hospital mortality, hospital and ICU length of stay [LOS], and time to transfer to the ICU) after adjustment for secular trends in patient case-mix and patient-level covariates which might impact outcome. We analyzed 500 (245 pre- and 255 postintervention) patients in the intervention hospital and 678 (323 pre- and 355 postintervention) in the control hospital. Patients at the control hospital were younger (60.5-60.6 vs 64.0-65.4 years, P < .001) with a higher severity of acute illness at the time of evaluation for ICU admission (Sequential Organ Failure Assessment score: 4.9-4.0 vs 3.9-3.9, P < .001). Using the difference-in-differences methodology, we identified no association of hospital mortality (odds ratio [95% confidence interval]: 0.81 [0.42 to 1.55], P = .52) or hospital LOS (% change [95% confidence interval]: −8.7% [−28.6% to 11.2%], P = .39) with admission to the intervention hospital after SDU opening. The ICU LOS overall was not associated with admission to the intervention hospital in the postintervention period (−23.7% [−47.9% to 0.5%], P = .06); ICU LOS among survivors was significantly reduced (−27.5% [−50.5% to −4.6%], P = .019). Time to transfer to ICU was also significantly reduced (−26.7% [−44.7% to −8.8%], P = .004).Opening our medical SDU improved medical ICU throughput but did not affect more patient-centered outcomes of hospital mortality and LOS.