Despite endless efforts in the quest for credible methods for evaluating clinical competence, the objective remains elusive. The components of competence include both clinical (interview skills, physical examination, differential diagnosis and therapeutic modalities) and technical skills. Written and oral examinations and, more recently, objective structured clinical examinations have been used as instruments for assessing the progress of trainees as well as for college or board certification and licensure to practice medicine. The American Board of Anesthesiology has adopted a more rigorous process for evaluating residents in training (Certificates of Clinical Competence). Newer methods have attempted to measure the competence of practicing physicians, including the analysis of data from physician-submitted ‘report cards’, ‘re-certification’ examinations, and patient outcome studies. Whole-body computerized patient simulators have become a major area of research for teaching clinical skills and assessing behavior as well as patient management during critical incidents. This review examines the significant literature in each of the areas cited.