Although supervision of clinical practice is mandatory for trainee psychologists, surprisingly little is known about the key ingredients of effective supervision and the relationship between supervision and patient outcomes. The purpose of this paper was to review current regulations that shape supervision in Australia and explore the links between these regulations and the components of effective supervision. Although recent developments including supervisor training and other quality control programs are an indication of progress, there are several empirical and conceptual issues in the supervision literature that require resolution. The second part of this paper identifies the gaps in the supervision literature and suggests steps to advance the development of a mature science of clinical supervision. The main areas requiring attention include the identification of the mechanisms by which supervision produces change in supervisees and their patients, the refinement of measurement methods and instrumentation, and the need to pursue collaborative research that maximises the generalisability of research findings.