A major problem in competency-based education is the lack of clarity in defining competence. This monograph describes the levels of competence used in developing competency-based educational programs and provides a taxonomy that can be used in developing competency-based instruction. The taxonomy includes four levels. Level 1 includes specific attitudes, knowledge, and skills. Level 2 includes competences which are clusters of skills, attitudes, and knowledge. Level 3 includes domains which are clusters of related competences. Level 4 includes clusters of domains which form a job. The monograph includes suggestions for writing competencies. It describes the A-B-C-Ds of writing a competence including audience, behavior, conditions, and degree. The issues of sequencing objectives and taxonomies of objectives are also discussed. (Contains 4 tables and 8 figures.) [This monograph was produced by the Center for Development of Human Services, a continuing education enterprise of the Research Foundation of the State University of New York. It was funded by the New York State Office of Children and Family Services.]