We developed a laboratory incident report classification system that can guide reduction of actual and potential adverse events. The system was applied retrospectively to 129 incident reports occurring during a 16-month period. Incidents were classified by type of adverse event (actual or potential), specific and potential patient impact, nature of laboratory involvement, testing phase, and preventability. Of 129 incidents, 95% were potential adverse events. The most common specific impact was delay in receiving test results (85%). The average potential impact was 2.9 (SD, 1.0; median, 3; scale, 1-5). The laboratory alone was responsible for 60% of the incidents; 21% were due solely to problems outside the laboratory's authority. The laboratory function most frequently implicated in incidents was specimen processing (31%). The preanalytic testing phase was involved in 71% of incidents, the analytic in 18%, and the postanalytic in 11%. The most common preanalytic problem was specimen transportation (16%). The average preventability score was 4.0 (range, 1-5; median, 4; scale, 1-5), and 94 incidents (73%) were preventable (score, 3 or more). Of the 94 preventable incidents, 30% involved cognitive errors, defined as incorrect choices caused by insufficient knowledge, and 73% involved noncognitive errors, defined as inadvertent or unconscious lapses in expected automatic behavior.