A system of appraising teachers that is acceptable to the teaching profession, the public, and school management is needed. To meet this need, Project D developed a diagnostic system of appraisal whose aim was to pinpoint areas in which teachers might reasonably be expected to improve their performance. The procedures adopted included the development of a set of standards for effective teaching, the construction of a self-appraisal instrument for the diagnosis of teaching needs, and the development of a network or set of guidelines for using the Self-Appraisal Instrument in an effective way. Over 800 critical incidents of effective and ineffective teaching were collected from a sample of teachers in the sponsoring school districts. Three fields of psychology (learning, measurement, and child development) were reviewed for principles whose application in the classrooms were critical in bringing about the intended instructional results. A list of principles of effective teaching and a collection of behavioral illustrations for all principles were employed in the construction of the Self-Appraisal Instrument (SAI). A diagnostic scoring system was developed to assist the teacher identify areas in need of improvement. Finally, guidelines were established for the proper implementations of the instrument. (Author/EA)