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In light of the paucity of literature discussing the systematic instruction of trainee psychologists in psychodynamic case formulation, the author introduces an eight-step method for teaching the theory and application of psychodynamic case formulation. The method involves clarifying the nature of psychodynamic formulations, outlining the characteristics of competent formulations, presenting a conceptually simple structure for organizing case material, exposing trainees to carefully selected written and video-recorded cases, and getting trainees to use their subjective responses to video-recorded initial clinical interviews as a source of useful hypotheses. A case study from the literature is used to demonstrate this formulation methodology. The paper concludes with a discussion of both the prerequisites for, and characteristics of, competent case formulation.