The Japan Thyroid Association (JTA) recently published new guidelines for clinical management of thyroid nodules. This paper introduces their diagnostic system for reporting thyroid fine-needle aspiration cytology. There are two points where the new reporting system that differs from existing internationally-accepted ones. The first is the subclassification of the so-called indeterminate category, which is divided into ‘follicular neoplasm’ and ‘others’. The second is the subclassification of follicular neoplasm into ‘favor benign’, ‘borderline’ and ‘favor malignant’. It is characterized by self-explanatory terminologies as to histological type and probability of malignancy to establish further risk stratification as well as to facilitate communication between clinicians and cytopathologists. The different treatment strategies adopted for thyroid nodules is deeply influenced by the particular diagnostic system used for thyroid cytology. In Western countries all patients with follicular neoplasms are advised to have immediate diagnostic surgery while patients in Japan often undergo further risk stratification without immediate surgery. The JTA diagnostic system of reporting thyroid cytology is designed for further risk stratification of patients with indeterminate cytology. If a surgeon applies diagnostic lobectomy to all patients with follicular neoplasm unselectively, this subclassification of follicular neoplasm has no practical meaning and is unnecessary. Cytological risk stratification of follicular neoplasms is optional and cytopathologists can choose either a simple 6-tier system without stratification of follicular neoplasm or a complicated 8-tier system depending on their experience in thyroid cytology and clinical management.