The effects of contextual characteristics and nursing-related factors on the overall quality improvement of resident outcomes, measured by a weighted index in incidents of pressure ulcers, physical restraints, and catheter use in nursing homes, were investigated by autoregressive latent trajectory modeling of panel data (1997-2003). Findings show that in the initial study period, nursing homes with a smaller bed size, being for-profit, caring for more Medicare residents, having residents with lower acuity levels, being located elsewhere than the South, having a high level of nurse staffing, and certified with lower frequencies of nursing care deficiencies had better quality. The intercept factor, representing the baseline of quality, was well predicted by six of the eight contextual and facility characteristics variables, and the slope trajectory of quality was only weakly predicted by them. The improved quality in resident outcomes was associated with facilities having fewer nursing care deficiency citations than their counterparts.