An accumulating body of empirical data suggests that current Department of Veterans Affairs (VA) psychiatric disability and rehabilitation policies for combat-related posttraumatic stress disorder (PTSD) are problematic. In combination, recent administrative trends and data from epidemiological and clinical studies suggest theses policies are countertherapeutic and hinder research efforts to advance our knowledge regarding PTSD. Current VA disability policies require fundamental reform to bring them into line with modern science and medicine, including current empirically supported concepts of resilience and psychiatric rehabilitation.