OBJECTIVE: The authors sought a practical means of monitoring and evaluating group psychotherapy, using existing clinical resources, for purposes of quality improvement and education on a large general hospital psychiatric service. METHOD: Monitoring indicators were developed which addressed 1) the integration of group psychotherapy into treatment planning and 2) the competence and technique of group psychotherapists. The second indicator was assessed by skilled observers using a newly constructed Group Psychotherapy Rating Scale in direct observation of group psychotherapy sessions. The rating scale was examined for interrater reliability and, as a measure of construct validity, for its ability to distinguish the performance of professional staff therapists from that of trainees. RESULTS: The indicators provided useful monitors of the use and quality of group psychotherapy. The rating scale had satisfactory interrater reliability and construct validity. The immediate constructive educational critique given by the observers of the therapy groups was highly valued by group therapists. CONCLUSIONS: The monitoring and evaluation program proved to be a practical, positive, and inexpensive means of assuring and improving the quality of group psychotherapy in a clinical setting.Abstract Teaser