This article challenges the validity of the DSM-III to exclude neurosis, which since then the DSM became “an expanding list of disease, from a few dozen disorders in the first edition to well over 200” (Grinker, 2010, p. 169; see also Warelow & Holmes, 2011). It points out the unanimous consensus that the best diagnostic approach would be a theory that can account for the development and treatment of certain diagnostic categories and at the same time provide measurable criteria that can distinguish them from other behaviors. Accordingly, it shows that a new theory, the Rational-Choice Theory of Neurosis (RCTN) (Rofé, 2000, 2010; Rofé & Rofé, 2013, 2015a, 2015b), which despite profound differences is similar to psychoanalysis in several fundamental respects, can offers practical diagnostic criteria that differentiate neurosis from other disorders. Three types of evidence, including review of research literature, case studies and new study that directly examined the validity of RCTN's diagnostic criteria, support the validity of neurosis. The greatest advantage of RCTN's diagnostic approach is not only that is based on empirical evidence instead the consensus of biased researchers. Rather, their main contribution is that they emerged of a theory that succeeded to integrate research and clinical data pertaining to the development and treatment of neurosis.