PURPOSE: To examine the validity of a psychiatry clerkship's objective structured clinical examination (OSCE). METHOD: In 1996, 33 clinical clerks and 17 psychiatry residents at the University of Toronto participated in an eight-station OSCE evaluated by psychiatrist-examiners using binary checklists and global ratings. Prior to the OSCE, communication course instructors were asked to rank the clerks on interviewing ability, and faculty supervisors were asked to identify the OSCE stations on which the clerks were likely to do well or poorly. RESULTS: Mean OSCE scores were significantly higher for the residents than for the clerks on global ratings but not on checklists. The communication instructors accurately predicted the clerks' rankings on the global scores but not their scores on the checklists. The faculty supervisors predicted with moderate accuracy the clerks' success on the OSCE stations as measured by the checklists but not by the global ratings. The residents rated the OSCE scenarios as highly realistic. CONCLUSIONS: The evidence of construct and concurrent validity together with high ratings of realism suggest that a psychiatry OSCE can be a valid assessment of clerks' clinical competence.