The current study reviewed the theories and models of identity development among clinical psychologists. Clinical psychologists commonly experience identity diffusion or confusion in their work, because of an absence of clear goals and approaches for providing support to clients. We propose that establishing a professional identity formation model for clinical psychologists could aid the development of methods for preventing identity diffusion. Research in our lab has revealed three main findings. First, clinical psychologists commonly experience identity diffusion in their work, but can recover from identity diffusion by relating to other clinical psychologists and people around them. Second, the cyclic model is useful in the development of professional identity formation models. Third, clients influence the identity development of clinical psychologists. Future research is needed to examine the specific relationships between clinical psychologists and people around them to find ways of preventing identity diffusion. There is also a need to investigate relationships between clinical psychologists and their clients, to understand the dynamics of therapeutic situations.