Information on the organization and funding of medical research was obtained by a questionnaire from 10 member countries of the European Medical Research Councils. Responses show that the ratio of medical research expenditure to Gross Domestic Product varied from 0.1 to 0.2% between these countries. In many countries, the largest single source of funds was pharmaceutical industry; its share of the total expenditure varied between 1 and 58%. Excluding pharmaceutical industry, the contribution of Medical Research Councils (MRC) varied from 2-22% of the remaining expenditure. The present figures, derived directly from the national research organizations, were considerably higher than the respective OECD [Organization for Economic Cooperation and Development] figures. A great deal of variation between the national MRC in the distribution of funds by field of research, type of activity, and type of cost was observed, probably explained to a great extent by availability of other sources of funds. All MRC used peer review in the assessment of research proposals. Criteria for peer review varied much. Only 2 MRC mentioned specifically the needs of the society among the criteria. The various medical research organizations are described in detail.