A recent survey has revealed a large number of young children in institutional care across Europe. Young children placed in institutional care without parents may be at risk of harm. This review considers systematically the research evidence on the impact of institutional care on brain growth, attachment, social behavior, and cognitive development. Analytical epidemiological study designs (i.e., including a control/comparison group) show that young children placed in institutional care are at risk of harm in terms of attachment disorder and developmental delays in social, behavioral, and cognitive domains. Delays in physical growth, neural atrophy, and abnormal brain development have also been implicated. The findings suggest that the lack of a one-to-one relationship with a primary caregiver is a major cause of harm to children in residential care. Evidence indicates that infants who are placed in institutional care will suffer harm to their development if they are not moved to family-based care by the age of 6 months. The neglect and damage caused by early privation and deprivation is equivalent to violence and policy makers should work to ensure that every child has the opportunity to grow up in a family environment.