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This dissertation research examines the rise and spread of alternative medicine in the U.S. health care field. Alternative medicine includes a variety of treatment therapies (e.g., acupuncture, therapeutic touch, acupressure, etc.) whose underlying principles rest uneasily with those of dominant mainstream medicine. Although their efficacy is still subject to challenge by the medical establishment, these therapies have enjoyed increasing public acceptance in the last two decades, and recently a number of hospitals have begun to incorporate them into their formal structure. In this context, I explore an under-theorized process, the contagion of legitimacy among practices--how the adoption of one or more therapies by a given hospital affects the adoption of other alternative therapies by other hospitals. I suggest that the spread of one practice can be regarded as an informational cue on which potential adopters rely in deciding whether to adopt other associated practices. As long as the informational cue enhances the familiarity and acceptability of new practices, this type of influence may be understood as the process in which the legitimacy of some practices is transferred to other associated practices. As an underpinning process of such association, I focus on categorization which lumps similar practices into a common category and thus creates a common identity for the grouped practices. I argue that a categorical scheme serves as a cognitive basis for association between practices that would otherwise be viewed as disconnected. I empirically examine if the adoption of members of one group of alternative therapies accounts for variation in adoption rates of other therapies which are also in the same group. The findings of analyses strongly support my argument that prior adoptions of alternative therapies by hospitals enhance diffusion rates of other therapies, especially when the therapies present a coherent categorical identity. This study concludes with theoretical implications of the empirical findings and directions for future research.