This chapter extends the account of speech perception begun earlier. The concept of "structure" used by contemporary linguists is examined and shown to have much in common with the notion of "Gestalt" familiar to students of visual perception. A general discussion of the relation between linguistics and psychology is followed by a more specific presentation of the principles of "phrase-structure grammar" and its implications. Natural sentences tend to follow certain rules of formation, and they are understood in terms of these rules. The hypothesis, as applied to linguistic processes, has already been used to deal with attention and immediate memory; here find that it is also useful in dealing with the complexities of grammar. One goal of English linguistics is the formulation of a set of rules which define and delineate exactly those phrase-markers that are proper English constructions. The constructive view of cognition in general, and "analysis-by-synthesis" in particular, must postulate some sort of generative mechanism.