A summary is presented of lessons learned recently in developing a software cost estimation model for TRW. With respect to general needs in the cost estimation field, it was found particularly important and useful to address the following three needs: (1. ) to develop a set of well-defined, agreed-on criteria for the ″goodness″ of a software cost model; (2. ) to evaluate existing and future models with respect to these criteria; (3. ) to emphasize ″constructive″ models that relate their cost estimates to actual software phenomenology and project dynamics. A set of criteria are presented which were found to be particularly important in practical software cost estimation, together with examples of their importance.