The relation between similarity and categorization has recently come under scrutiny from several sectors. The issue provides an important inroad to questions about the contributions of high-level thought and lower-level perception in the development of people's concepts. Many psychological models base categorization on similadty, assuming that things belong in the same category because of their similadty. Empirical and in-principle arguments have recently raised objections to this connection, on the grounds that similarity is too unconstrained to provide an explanation of categoAzation, and similadty is not sufficiently sophisticated to ground most categodes. Although these objections have merit, a reassessment of evidence indicates that similarity can be sufficiently constrained and sophisticated to provide at least a partial account of many categories. PAnciples are discussed for incoroorating similarity into theories of category formation.