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Accreditation of residency programs and certification of physicians requires assessment of competence in communication and interpersonal skills. Residency and continuing medical education program directors seek ways to teach and evaluate these competencies. This report summarizes the methods and tools used by educators, evaluators, and researchers in the field of physician-patient communication as determined by the participants in the "Kalamazoo II" conference held in April 2002. Communication and interpersonal skills form an integrated competence with two distinct parts. Communication skills are the performance of specific tasks and behaviors such as obtaining a medical history, explaining a diagnosis and prognosis, giving therapeutic instructions, and counseling. Interpersonal skills are inherently relational and process oriented; they are the effect communication has on another person such as relieving anxiety or establishing a trusting relationship. This report reviews three methods for assessment of communication and interpersonal skills: (1) checklists of observed behaviors during interactions with real or simulated patients; (2) surveys of patients' experience in clinical interactions; and (3) examinations using oral, essay, or multiple-choice response questions. These methods are incorporated into educational programs to assess learning needs, create learning opportunities, or guide feedback for learning. The same assessment tools, when administered in a standardized way, rated by an evaluator other than the teacher, and using a predetermined passing score, become a summative evaluation. The report summarizes the experience of using these methods in a variety of educational and evaluation programs and presents an extensive bibliography of literature on the topic. Professional conversation between patients and doctors shapes diagnosis, initiates therapy, and establishes a caring relationship. The degree to which these activities are successful depends, in large part, on the communication and interpersonal skills of the physician. This report focuses on how the physician's competence in professional conversation with patients might be measured. Valid, reliable, and practical measures can guide professional formation, determine readiness for independent practice, and deepen understanding of the communication itself.