Forest lands of the Inland Northwest have many timber stands consisting of overgrown, densely stocked trees that create a fire hazard and are prone to disease. These stands need to be thinned, but the cost of harvesting often exceeds the value ofthe timber produced. However, because of the dense stocking and the resulting slow growth these trees may produce lumber with desirable mechanical properties. One method for sawmills to more fully utilize the potential grade yield and realize greater economic return from such lumber may be to produce machine-stress-rated (MSR) lumber instead of visually graded dimension lumber. The purpose of this study was to determine the mechanical properties, and corresponding economic value, of lodgepole pine, grand fir, and ponderosa pine dimension lumber produced from typical overstocked forest stands in northern Idaho. The lumber was visually graded and tested for modulus of elasticity and modulus of rupture, and each piece was sorted into two types of grade categories: 1) visual Structural Light Framing; and 2) MSR. This study indicated that two of the three species we tested had good visual and mechanical characteristics. MSR grading of the lodgepole pine group produced a $27/MBF increase in value above visual grading, and MSR grading the grand fir group produced a $15/MBF increase in value above visual grading. The ponderosa pine samples were from poor quality trees thinned from below. Because ofthe poor yield in the higher visual grades, ponderosa pine thinnings in this study were judged not to be a good candidate for production of MSR lumber. This study points out the potential value of lumber sawn from overstocked stands of timber, but demonstrates the need for an assessment process to estimate local resource capability.