Abstract: The prevailing definitions of severe emotional disturbance (SED) are based on clinical diagnosis and functional impairment over a specified time period. Although there are numerous definitions of SED, the State of Wisconsin has specific criteria for state-funded programs. Multisystemic therapy (MST) and systems of care treatment are the two primary modalities of intervention for children with SED. These interventions target service delivery in a family based structure that allows for interaction among care providers and natural supports. Research on children with SED has overwhelmingly utilized linear modeling to assess a population of children who are treated in an individual fashion, as they present with complicated family and environmental situations. A nonlinear cusp catastrophe model of behavior change among children with SED advanced and tested to address more clearly the complex behavioral patterns of children and families impacted and to evaluate the stability of treatment outcomes. Treatment outcome in children with SED can be modeled as a cusp catastrophe with two stable states of behavior, high and low scores on the outcome measure. The control parameters were defined as time in treatment (bifurcation), out of home placement (asymmetry), and comorbidity (asymmetry). Subjects were 40 children and adolescents who were receiving services through the Outagamie County IIH program, ages ranged from 3 to 16 years. Variance accounted for by the cusp outperformed the best alternative model by a ratio of approximately: 1.23:1. These findings imply that treatment outcome and behavior change in children with SED does not best fit the standard linear model of therapeutic outcome and should be examined from a new direction.