This monograph attempts to clarify one significant but much neglected aspect of Peirce's contribution to the Philosophy of Science. Peirce claimed that besides deduction and induction there was another type of reasoning which he called abduction. Abduction is the reasoning process by which new ideas, explanatory hypotheses, and scientific theories are engendered. It is the logic of discovery and the essence of Pierce's pragmatism. Peirce returned repeatedly to the investigation of the logic of abduction during his long creative life. His writings on the subject are typically fragmentary and diverse. They fall roughly into two periods. In the early period Peirce treated inference, and hence abduction, as an evidencing process. The three kinds of inference were considered independent forms of reasoning. In the later period the concept of inference was widened to include methodological as well as evidencing process. The three types of reasoning became three stages of inquiry. The author has reconstructed a consistant account of Peirce's theory of abduction. In Part I the attention is focused on the chronological development of Peirce's early theory, so that the later theory may be understood more clearly in the light of the earlier views. Part II contains a systematic presentation of the later theory and a critical analysis of Peirce's contribution to the study of the logic of discovery.