The National Institute for Health and Clinical Excellence (NICE) has been responsible for managing the process of developing new clinical and health improvement indicators for the United Kingdom (UK) Quality and Outcomes Framework (QOF) and reviewing the current QOF clinical indicator set since April 2009. This paper sets out in detail the NICE-led process for QOF indicator development and describes experience to date (2009-2011) in four key areas: prioritisation of clinical guideline recommendations by the QOF advisory committee, development and piloting of quality indicators, cost-effectiveness analysis and retirement of QOF indicators. It concludes by reflecting on potential future developments of the QOF.