A group of "difficult" psychiatric outpatients in a university hospital system was identified and its distinguishing characteristics compared to a sample of other psychiatric outpatients not so labeled. "Difficult" patients were perceived to be significantly more demanding (p less than or equal to 0.005), dangerous, difficult to empathize with, manipulative and likely to polarize the staff. These patient were perceived differently by physician and nonphysican staff. An analysis revealed that a major source of "difficulty" appeared to be the structure of the treatment system rather than the patient. A corrective strategy was devised to test this hypothesis.