Cancer is the second leading cause of mortality in America and has a profound impact upon individuals, families, health care providers, and society at large. A substantial minority of cancer patients experience clinically significant symptoms of psychological distress, which can be associated with a wide range of negative health outcomes. Currently available screening measures narrowly define distress, are relatively primitive tools and their relationship to patient behavior is largely unknown. The current study sought to evaluate the psychometric properties and clinical utility of Distress Screening System (DSS), a comprehensive measure developed to address these limitations. There were 492 individuals diagnosed with cancer assessed in the current study through mail-out questionnaires and follow-up phone interviews. The majority were female (71.3%), married (59.6%) and Caucasian (68.6%) or African American (20.7%), with a mean age of 61.41 years (SD = 12.92). Preliminary and exploratory factor analysis revealed the DSS to possess appropriate internal and concurrent validity, and to be sufficiently unidimensional to proceed with further examination. Item response analysis revealed moderate overall model fit, with the majority of items performing well with adequate levels of discrimination and difficulty across the distress continuum. The DSS was most accurate in assessing moderate to high levels of distress. Examination of clinical utility revealed no significant advantage for the DSS in predicting quality of life or referral preference. The DSS appears to be a psychometrically valid measure of distress and provides the basis for a broader conceptualization of this construct. The majority of items performed well within a unidimensional item response framework and may therefore be suitable to utilize within a computerized assessment format. Despite these results, the DSS did not demonstrate a significant advantage in the prediction of participants’ quality of life or referral preference. The current study provides a foundation for future work examining the conceptualization of distress and development of screening tools within an advanced psychometric framework and computerized administration. Advances in empirical measurement and clinical assessment are vital in addressing the ongoing challenge of providing nationwide comprehensive cancer care.