Summary: Because of dissatisfaction with the traditional long case procedure as a method of examining the clinical competence of medical students undertaking a psychiatry term, an alternative ‘direct’ method whereby two examiners observe the interaction between student and patient has been developed and is described. This method of examining allows the examiners to set and evaluate case-specific tasks. It is demonstrated that the two examiners achieve satisfactory inter-rater reliability both with respect to the mark awarded and the difficulty the patient presents and that, as one would wish, these two measures do not correlate. Students' opinions regarding the examination were assessed pre- and post-examination using visual analogue scales. The students found the examination stressful but rated the method as an appropriate form of clinical assessment both before and after their examination. The method is seen as having several advantages which must be set against the disadvantage of its being relatively expensive of examiners' time.