This report describes research at the University of Iowa College of Nursing to develop a comprehensive classification of nursing-sensitive patient outcomes. The Nursing-Sensitive Outcomes Classification (NOC) completes the nursing process elements of the Nursing Minimum Data Set (NMDS). We describe resolution of conceptual and methodological problems that define the inductive approach taken to develop the NOC. Strategies used to develop NOC included review of the literature, clinical databases and instruments; concept analysis; and surveys of nurse experts. Examples of outcomes, definitions, and indicators are presented. The NOC provides standardized patient outcomes for determining the effectiveness of nursing interventions and enables inclusion of these data in data sets for healthcare effectiveness research.