Background Intensive community services may provide an alternative to inpatient care but there is little systematic evidence of their efficacy. This article provides a systematic review of randomized controlled trials (RCTs) reporting efficacy of intensive community services versus inpatient care in youth. Method Data sources were identified by searching Medline, PsychINFO and EMBASE databases as of December 2014. RCTs comparing intensive community services versus inpatient care in children and adolescents (through age 18) were included. Results Six unique RCTs including 569 youth were identified. The RCTs examined the efficacy of specialist outpatient treatment, multisystemic therapy, day patient treatment, intensive home treatment and supported discharge services versus inpatient care. Using intensive community services was associated with clinical improvements similar to inpatient care in most studies. Where differences in clinical outcomes existed, they tended to favour intensive community treatment. Using intensive community services was associated with shorter hospitalizations, lower costs and greater patient satisfaction. There were no independent replications of the results. Few studies investigated the use of intensive community treatment as an alternative to inpatient care in children and adolescents with severe immediate risk to self and others. Conclusions Intensive community services appear to be a viable alternative to inpatient care. Independent replication of results achieved by specific intensive community treatment models is a research priority.