Nineteen consecutive shoulders in 19 patients were treated for multidirectional shoulder instability with an arthroscopic capsular shift. Indications for the procedure included complaints of pain, instability, or both that was unresponsive to a prescribed exercise program that stressed rotator cuff and scapular stabilizer strengthening. All patients had evidence of increased joint laxity on physical examination; 17 had a 2+ or greater sulcus test and 2 had 3+ laxity both anteriorly and posteriorly. Fourteen of the 19 patients were injured during athletic activity. All surgeries were performed in an outpatient setting. All the patients were evaluated at an average of 34 months postoperatively with a minimum follow-up of 25 months. Based on the outcome scale described by Tibone and Bradley, the average postoperative score was 91 out of a possible 100 with 13 excellent, 5 good, and 1 fair result. All but 1 of the athletes returned to their previous level of performance but none were elite throwers. One patient had recurrent anterior subluxations treated with a repeat arthroscopic capsular shift and was rated as good. The patient rated as fair had no improvement in her pain after surgery. One patient complained of a painful supraclavicular suture that resolved spontaneously. There were no neurovascular complications or infections. Visualization of intra-articular pathology was enhanced with the arthroscope and aided in the diagnosis of multidirectional instability. The described technique proved safe and effective in treating multidirectional instability and enabling athletes to return to their previous level of function.