The diurnal cycle of outgoing longwave radiation (OLR) computed by a climate model provides a good test of the numerical description of various physical processes. Diurnal cycles computed by version HadAM3 of the Hadley Centre climate model are compared with those observed by the Earth Radiation Budget Satellite (ERBS) for the boreal summer season (June, July and August). The ERBS observations cover the domain 55oS to 55oN. In order to compare the observed and modelled diurnal cycles, the principal component (PC) analysis method is used over this domain. The analysis is performed separately for land and ocean regions. For land over this domain, the diurnal cycle computed by the model has a root-mean-square (RMS) of 16.2 Wm-2, compared with 13.3 Wm-2 for ERBS. The PC-1 for ERBS observations and for the model are similar, but the ERBS result is quite symmetric about local noon and decreases very slightly at night, whereas the peak of the model result lags significantly and at night the OLR decreases much more. Some of the difference between the ERBS and model results are due to the computation of convection too early in the afternoon by the model. The PC-2 describes morning/ afternoon cloudiness, depending on the sign. Similar results are obtained for the model for the global domain for July. Over ocean in the ERBS domain, the model RMS of OLR diurnal cycle is 4.0 Wm-2, compared with 5.9 Wm-2 for ERBS. Also, for the model, PC-1 accounts for 66% of the variance, while for ERBS, PC-1 accounts for only 16% of the variance. Thus, over ocean the ERBS results show a greater variety of OLR diurnal cycles than does the model.