As in any other industry, laws and regulations significantly impact the functioning of the healthcare industry. Some laws, such as those relating to malpractice and social insurance systems, affect the manner in which the industry operates. Other laws, such as those regulating antitrust and employment practices, affect the organization and the environment in which the industry operates. It is increasingly important that practitioners and managers be cognizant of this complex and dynamic legal minefield. This study examined healthcare managers and executives' knowledge of 9 key issues in the legal and regulatory environment of the healthcare industry. Specifically, the study focused on knowledge concerning tort and contract liability, insurance law, labor and employment regulation, criminal and ethical responsibility, antitrust regulation, the law governing business associations and recent developments. Findings suggest that the levels of knowledge required to manage legal and regulatory issues are much greater than the existing levels of knowledge.