During the eighteenth century a new approach to the treatment and care of the mentally ill was starting to surface, it would come to be known as moral treatment. Prior to this movement most people believed that insanity was the result of spiritual forces, or the "wrath of god".  One of the key moral treatment figures in the United States was Benjamin Rush. He published the first textbook on the subject of mental illness in the United States; Medical Inquiries and Observations upon the Diseases of the Mind in 1812. As an eminent Physician at the Pennsylvania Hospital in Philadelphia, he limited his practice to mental illness and developed innovative, humane approaches to treatment. The Pennsylvania Hospital, which was established in 1751, didn't have proper facilities to care for patients with mental illnesses and most were kept in rooms in the basement of the hospital. Care for the insane in rural communities amounted to a few poor houses, but most lived in homes with family members. If the family was unable to provide care or pay for a private hospital, like the Pennsylvania Hospital, then that member of the family was often left on their own to wander the streets, in some cases they were even locked in a room or the basement.

Rooms in the basement of the Pennsylvania Hospital used for patients with mental illnesses

By 1832 the Board of Managers of the Pennsylvania Hospital recognized the necessity of opening a separate asylum with the sole purpose of caring for patients with mental illnesses. The Pennsylvania Hospital purchased a 101 acre farm in West Philadelphia in 1835 on which the cornerstone for a new facility was laid on July 26, 1836. The new hospital would be known as The Pennsylvania Hospital for the Insane. The new hospital opened in 1841 and would eventually be run by Dr. Thomas Kirkbride. Dr. Kirkbride would also have an important role in early treatment and care of those with mental illnesses. Several other private hospitals had also opened in the United States in the early nineteenth century with the sole purpose of caring for those with mental illnesses. In 1817 the Friends Asylum at Frankford opened, though it was exclusive to Quakers until 1834. A hospital also opened in Bloomingdale, New York in 1821. All of these hospitals however were private hospitals and did not admit patients that could not pay for care.

The industrial revolution during the mid nineteenth century brought many people from rural communities into larger cities. With the expansion of the city populations also came an expansion of people with mental illnesses. During this time there was a movement for  government control over many services that were previously privately controlled. Services such as banks, canals, railroads, hospitals, poorhouses, and prisons. Along with this movement came the idea that care for those with mental illnesses should be handled by state

governments. In conjunction with successful lobbying efforts of nineteenth century social reformer Dorothea Dix, the Harrisburg State Hospital was created as the Pennsylvania State Lunatic Hospital and Union Asylum for the Insane in 1845 to provide care for mentally ill persons throughout the Commonwealth of Pennsylvania. A nine member board of trustees was empowered to appoint a superintendent, purchase land, and construct facilities near Harrisburg. This board of trustees received no compensation for their work. In 1848, the name of the hospital was changed to the Pennsylvania State Lunatic Hospital when $50,000 was appropriated to begin construction. Patients from all parts of the state would be accepted at the hospital, at the expense of the counties that they belonged; or, if able they would pay for themselves at a cost of $2.50 per week. This cost included board and medical attention.

A lithograph image of the Friends Asylum, a private hospital located outside Philadelphia