Managers of multidisciplinary teams face difficult dilemmas in managing competing interests, diverse perspectives and interpersonal conflicts. This paper illustrates the potential of the theory of action methodology of Argyris and Schön (1974, 1996) to illuminate these problems and contribute to their resolution. An empirical example of a depth-investigation with one multidisciplinary community health care team leader in Australia demonstrates that the theory of action offers a more accurate account of the causal dimensions of her dilemmas and provides more scope for effective intervention than her lay explanation will allow. It also provides a more satisfactory analysis of her difficulties with two common problems identified in the literature: defining the appropriate level of autonomy for team members and developing constructive dialogue across perceived discipline-based differences of opinion. Consequently the theory of action appears to offer enormous promise to managers of multidisciplinary teams wanting to understand and resolve their problems and develop a rigorous reflective practice. Further research on the viability of the theory to facilitate a self-correcting system that can promote learning even under conditions of stress and conflict is suggested and implications for learning and teaching for the multidisciplinary environment are briefly discussed.