University of Illinois researchers performed a study with 35 cats to test their behavior when indoors; and what they discovered was intriguing.
Cats, just like dogs and humans, require stimulation. They cannot stand doing the norm, being inside much; and require an "enriched environment" for this stimulation. They do not like small spaces.
"The research setting...created for cats was in a temperature-controlled pole barn and included a two-level open structure, natural light, a giant climbing tree, furniture, toys, scented objects and lots of hiding holes." (NG News, written by Debra Pressey)
The cats also had a quarter of an acre of land to play on for stimulation. This shows that when cats are surrounded by other animals, in an outdoor cat enclosure, they seemed to produce positive results that made them happier. They also appeared to be more "adoptable" thanks to the emphasis on socialization, enrichment and training.