This paper considers research into the use of institutional care in terms of cognitive development for the very young children in the states of North-West India. Cross – sectional data on 504 institutionalized and 570 controls (including both the sexes) aged 11 to 17 years were collected. In the present study, an attempt has been made to assess IQ and study the effect of institutionalization on variations in IQ with age in institutionalized and control adolescents of Punjab, Haryana and Chandigarh. Intelligence was assessed by Raven’s Standard Progressive Matrices and the subjects were further classified into 7 categories of IQ based on classification given by Wechsler. More than half of the adolescents residing in orphanages were significantly below the average intelligence levels (IQ below 70). Institutionalization was responsible for lag in cognitive development of institutionalized adolescents