The Human Potential Movement came out of the social and intellectual milieu of the 1960s and was formed to promote the cultivation of extraordinary potential believed to be largely untapped in most people. The movement is premised on the belief that through the development of human potential, humans can experience an exceptional quality of life filled with happiness, creativity, and fulfillment. A corollary belief is often that those who begin to unleash this potential will find their actions within society to be directed towards helping others release their potential. The belief is that the net effect of individuals cultivating their potential will bring about positive social change at large.

The movement is sometimes considered to be under the broader umbrella of the New Age movement. It is distinguished ideologically from other New Age trends by an emphasis on the individual development of secular human capabilities as opposed to the more spiritual views within the movement. However, participants rarely make this distinction and it is common to find that most who embrace the ideas of the human potential movement also tend to embrace the other more spiritual ideas within the New Age movement.

The Esalen Institute was formed by Michael Murphy and Dick Price primarily as a center for the study and development of human potential, and is considered to be the geographical center of the movement today. Aldous Huxley gave lectures on the "Human Potential" at Esalen in the early 1960s and his ideas are also considered fundamental to the movement.

The movement has received criticism in two forms. The first is from researchers in psychology, medicine, and science who often dismiss the movement as being grounded in pseudoscience, overusing psychobabble, and whose efficacy can be explained entirely by placebo. This criticism was expressed by Richard Feynman's response to his visit at Esalen.

However, a technique may still be useful despite a pseudoscientific or religious background. The crucial point is whether critics are correct in asserting that the techniques of the human potential movement have no effect other than the placebo effect or an attitudinal effect such as the Hawthorne effect (of course, many mainstream psychotherapeutics techniques have no such effect, either). Empirical research is required to settle this question.

The second criticism comes from those often considered sympathetic to the movement, but who believe that the movement has not succeeded in its goals, but has instead created an environment that actually inhibits personal development. The claim is that it encourages childish narcissism by reinforcing the behavior of focusing on one's problems and expressing how one feels, rather than encouraging behaviors to overcome these problems. This criticism is best viewed in the terms of Maslow's hierarchy of needs. In this analysis, the failure is characterized as an exclusive focus on helping individuals fulfill their Deficit Needs, without moving individuals up the hierarchy to Being Needs, i.e., self-actualization.

A more serious extension of this criticism claims that this problem is due to a flawed foundation of the movement altogether—the focus on the individual's own development as supreme to the detriment of the consideration of others and society.

This issue again can only be resolved by empirical research. The contention that the Human Potential Movement encourages narcissism requires documentation.