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In 1848, Dorothea Dix visited North Carolina and called for reform in the care of mentally ill patients. In 1849, when the North Carolina State Medical Society was formed, the construction of an institution in the capital, Raleigh, for the care of mentally ill patients was authorized. The hospital opened in 1856 and was named later in honor of Dorothea Dix.
The hospital grounds at one time included 2,354 acres (9.53 km2), which were used for the hospital's farms, orchards, livestock, timber tracks, maintenance buildings, employee housing, and park grounds. The great majority of the land was later sold, and, in the last two decades, developed into North Carolina State University's "Centennial Campus," the state Farmer's Market and other projects.
As of 2000, a consultant said the hospital needed to close.
The Dorothea Dix Hospital was at one time slated to be closed by the state by 2008, and the fate of the remaining 306 acres (1.24 km2) was a matter of much discussion and debate in state and local circles. As of October 6, 2008, according to the News & Observer, state officials were calling the facility "Central Regional Hospital - Raleigh Campus."  But in 2009, the state announced that Dorothea Dix Hospital would not be closing and would not be a "satellite" of CRH. It was announced in August 2010 that a lack of funding meant the facility would "shut its doors by the end of the year." 
A thorough history of the hospital was published in 2010 by the Office of Archives and History of the North Carolina Department of Cultural Resources.
In August 2012, Dorothea Dix Hospital moved its last patients to Central Regional Hospital in Butner, North Carolina, which critics said did not provide enough beds for the most serious cases. To help alleviate the situation, in May 2012, UNC agreed to spend $40 million on mental health services.
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