A transfer-matrix-scaling technique is developed for randomly diluted
systems, and applied to the site-diluted Ising model on a square latti
ce in two dimensions. For each allowed disorder configuration between
two adjacent columns, the contribution of the respective transfer matr
ix to the decay of correlations is considered only as far as the ratio
of its two largest eigenvalues, allowing an economical calculation of
a configuration-averaged correlation length. Standard phenomenologica
l-renormalization procedures are then used to analyze aspects of the p
hase boundary which are difficult to assess accurately by alternative
methods. For magnetic site concentration p close to p(c), the extent o
f exponential behavior of the T(c) x p curve is clearly seen for over
two decades of variation of p - p(c). Close to the pure-system limit,
the exactly known reduced slope is reproduced to a very good approxima
tion, though with nonmonotonic convergence. The averaged correlation l
engths are inserted into the exponent-amplitude relationship predicted
by conformal invariance to hold at criticality. The resulting exponen
t eta remains near the pure value (1/4) for all intermediate concentra
tions until it crosses over to the percolation value at the threshold.