The United States Air Force Officer Effectiveness Report (OER) is the performance appraisal system for the officer corps. Uses of the OER include personnel selection for training, assignments, reductions in force, and, most importantly, promotions. Since the primary function of the officer corps is to lead, the OER should be focused on leadership potential. This paper reviews officership and leadership in the military; summarizes results of recent studies in performance appraisal; discusses the extent to which the present OER addresses leadership; and, makes recommendations for improving the leadership potential aspects of the OER. The paper develops a list of eight desirable leadership traits to be used as rating dimensions, or performance factors. These traits are: knowledge, planning ability, goal setting, communicative ability, personal contacts, initiative, delegation, and responsibility. In addition, the paper recommends a retain/release rating block of professional competence to address the required traits for an officer. The paper concludes that the present OER addresses leadership to a great extent: however, the recommended traits provide a broader scope in evaluation of leadership potential.