This study analyzed the potential of peer clinical supervision as an effective approach to the supervision of teachers and examined the many variables that affect the model's effectiveness. Eleven volunteer elementary school teachers participated in three training sessions designed to explore the conceptual nature of clinical supervision and to train the participants in clinical supervision techniques. Each participant completed three cycles of clinical supervision. Questionnaires, interviews, audiotapes, and field notes were used to report the study's findings. Peer clinical supervision fared best in schools typified by positive collegial relations, sustained faculty interactions, leadership that supported the process, and a sense of professional initiative. The study concluded that peer supervision can make a contribution, but only after recognizing the numerous variables bearing directly on the success of the effort. Appendices present examples of seating charts, a time chart, pre-observation agreement form, questionnaire, and interview forms. (Author/CB)