There are about 200 exercise yards and feedlots in Finland. Their total area is about 20 000 m². The number of exercise yards and feedlots is set to grow because of legislation concerning animal welfare. The act on animal welfare which came into force in 1996 provides that during the summer period dairy cows and heifers must be allowed to go to pasture or, failing this, that a space must be provided in such a way as to allow the animals to move around. The period of transition ends at the beginning of July 2006. Depending on the use of the yard, there are different aspects that have to be taken into consideration. The structure of the yard, the surface material and the space allowance are important from the point of view of both animal welfare and environmental impact. Two exercise yards have been designed and constructed within our research project. The first yard consists of two different parts with a total area of about 11 m² per cow. The area beside the barn, 5 m² per cow, is made of asphalt, and the area further away, 6 m² per cow, is covered with bark to a depth of up to 30 cm. The layer under the bark is gravel, and at the bottom there are drainage tubes laid five metres apart, so as to be capable of collecting all the water coming through the upper layers. The yard has been fenced in using a simple timber fence with a height of 1.6 metres. The estimated costs of the asphalt area are 18.40 per m² and those of the bark cover area 8.30 per m². The second yard has an area of about 30 m² per cow. It is hardened with a 10-cm layer of stabilized slag. A 20-cm layer of granulated slag is also used in the supporting structure because of its insulating characteristics. The yard has been fenced in with a timber fence with a height of 1.5 metres. The estimated costs of this yard are 11.30 per m². The space requirement per cow depends on the use of the exercise yard. If all the cows are forced to go out at a certain time and if they are fed there, an area of between 5 and 10 m² per cow is needed. But if there is no feeding and the cows have free access to the yard, only 4 5 m² per cow is sufficient. The fences have to be high enough; a height of 1.5 1.6 m is recommended. The structure of exercise yards depends mainly on how much space there is per cow. When the space allowance is small, it is recommended that yards should have dense surfaces. If there is more room, part of the yard can be covered with soft material that cows find more comfortable. It is advisable to design the yard so that the area covered with soft material can be blocked off whenever it gets too wet. In all cases, the area around doors and feeding facilities should have a dense surface.