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The Psychodynamic Diagnostic Manual (PDM) and its successor, the PDM-2, were developed to provide a framework for conceptualizing psychological dysfunction that is more comprehensive and clinically useful than extant symptom-focused diagnostic manuals (i.e., the International Classification of Diseases, the Diagnostic and Statistical Manual of Mental Disorders). By evaluating symptom patterns and the patient's subjective experience (Axis S), personality patterns and disorders (Axis P), and the individual's mental functioning in a broad array of domains (Axis M), the PDM-2 provides a contrasting, person-centered perspective to the conceptualization and classification of psychopathology. This article examines the ways in which PDM-2 can enhance case formulation, psychodynamic and otherwise. I begin by describing the evolution of the major diagnostic systems, and contemporary approaches to case formulation. I discuss the role of diagnostic manuals in case formulation, and the ways in which PDM-2 may be more helpful than other diagnostic systems in this regard. Finally, I describe the ways in which PDM-2 sets the stage for more rigorous multimethod psychological assessment to enhance case conceptualization and facilitate treatment, and offer suggestions for future work in this area.