Objective: This study aimed to characterize the use of mandated quality indicators (QIs) in public sector nursing homes by describing their adherence to established principles of measurement and whether nursing homes respond to QI data to improve care. Method: Data were collected from a descriptive cross-sectional quantitative study using a confidential survey questionnaire distributed electronically to senior staff in all public sector nursing homes in Victoria, Australia. Results: Staff from 113 of 196 facilities completed the survey (58%). Adherence to principles of measurement was suboptimal, with variation in applying QI definitions and infrequent random audits of data (n = 54, 48%). QI data triggered reviews of individual residents (62%-79%), staff practice (44%-65%), and systems of care (45%-55%). Most facilities (58%-75%) reported that beneficial changes in care occurred as a result of using QIs. Discussion: QI performance data are positively received and used to improve care. Standardization of data collection, analysis, and reporting should strengthen the program’s utility.