Psychiatric identity may be considered as a reflection of the adequacy of the nosology used in psychiatry. TheDiagnostic and Statistical Manual of Mental Disorders (DSM-II)is considered inadequate from a number of standpoints. The development of valid nosology in psychiatry depends on an understanding of the concepts of arbitrary focus, differentiation and standardization, time framing and reductionism, and systems. These principles provide conceptual guidelines in the development of nosology andDSM-IIis analyzed according to each principle to point out its shortcomings. Various nosologies are valid for development and what kind depends on the use to be made of the nosology, ie, the pragmatics of nosology. Three types of nosology are discussed: interventional, descriptive, and administrative. Finally, the implications of the foregoing are discussed with reference to new nosologic systems, and in reference to their role in establishing new limits of identity for psychiatry.