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This paper critically reviews the process and outcome of an effort to enhance the cultural validity of DSM-IV and outlines recommendations to improve future diagnostic systems. An ordered presentation of the antecedents and the main phases of this developmental effort is followed by a content analysis of what was proposed and what was actually incorporated, and a conceptual analysis of underlying biases and their implications. The cultural effort for DSM-IV, spearheaded by a scholarly independent NIMH workgroup, resulted in significant innovations including an introductory cultural statement, cultural considerations for the use of diagnostic categories and criteria, a glossary of culture-bound syndromes and idioms of distress, and an outline for a cultural formulation. However, proposals that challenged universalistic nosological assumptions and argued for the contextualization of illness, diagnosis, and care were minimally incorporated and marginally placed. Although a step forward has been taken to introduce cultural elements in DSM-IV much remains to be done. Further culturally informed research is needed to ensure that future diagnostic systems incorporate a genuinely comprehensive framework, responsive to the complexity of health problems in increasingly multicultural societies.