This paper is to review the performnce appraisal system which is one of the most fundamental systems in personnel administration. The paper is also to survey the practices of the performance appraisal system in Korea on limited basis. The purpose of the study is to suggest the direction for the sound performance appraisal system. The subject of the review includes the following areas; definition and purpose of performance appraisal, approaches and historical trend of appraisal systems, various techniques of performance appraisal, criteria of appraisal, the processes and issues of performance appraisal, etc.. In addition, the results of a brief survey on the practices of performance appraisal system in Korean industry are analyzed. Finally, a few suggestions for the sound performance appraisal systems are discussed.