We used a newly developed evaluation strategy to compare the performance of 12 medical residents who received ambulatory care rheumatology training and 12 who received inpatient consultative training. There was no significant difference in the cognitive test scores or the patient examination skills of the 2 groups. The ambulatory care residents saw more patients with common rheumatic diseases and performed more joint aspirations and injections. Both groups performed significantly better in all education impact measurements than did a control group of medical residents who received no formal rheumatology elective training. The control group of residents performed no better than did fourth-year medical students who had no formal rheumatology elective training. The study demonstrated that formal rheumatology training is essential if medical residents are to achieve adequate skills in rheumatology. This training can be provided through ambulatory care or inpatient-oriented electives.