A treatment model is described that has as its primary focus reducing the level of handicap of individuals with traumatic brain injury (TBI) by addressing the interaction between critical environmental variables and areas of deficit. The model focuses on two primary environmental variables—degree of distraction tolerated and degree of structure required by each individual to function optimally. These variables are systematically addressed in treatment through environmental simulations within the clinic. An outcome measurement system (Pate Environmentally Relevant Program Outcome System [PERPOS]) is presented that quantifies the level of handicap throughout treatment and at discharge as a function of the interplay between deficit and environment. Data are provided that validate the PERPOS scores through comparison with qualitative descriptors of day-to-day functioning in several domains. Outcome data indicate the participants in this treatment model made significant gains with regard to reduction of handicap.