The turn of the 21st century was marked by the rise of formal democracy in Lithuania. Classical democracy perceived and understood mainly through elections and citizen participation in the political and policy processes has been extended to more instruments and more levels. Residents can now actively participate in decision-making at all levels: at the macro level as a part of electorate, as well as at the micro level as users of public services. The objective of the article is to analyse the process towards democracy in Lithuania from the perspective of residential care and user-involvement. The empirical part of the article provides an analysis of the results of the sociological research on residential care institutions, which reveals how significant co-participation and empowerment in the organization of social services and the provision of them are for ensuring subjective well-being. Co-participation and empowerment in the provision of services should be considered in a methodological way and perceived as some of the most significant examples of the manifestation of modern genuine democracy.