Recent experiments have demonstrated that category goodness influences the perception of vowels [Iverson and Kuhl, J. Acoust. Soc. Am. 97, 553-562 (1995)]; listeners show a perceptual magnet effect characterized by shrunken perceptual distances near excellent exemplars of vowel categories and stretched distances near poor exemplars. The present study extends this investigation by examining the relative influence of phonetic identification and category goodness on the perception of American English /r/ and /l/. Eighteen /ra/ and /la/ tokens were synthesized by varying F2 and F3 frequencies. Adult listeners identified and rated the goodness of individual stimuli, and rated the similarity of stimulus pairs. Multidimensional scaling analyses revealed that the perceptual space was shrunk near the best exemplars of each category and stretched near the category boundary. In addition, individual differences in /r/ identification corresponded to the degree of shrinking near the best exemplars of the /r/ category. The results demonstrate that category goodness and phonetic identification both contribute to the perception of /r/ and /l/.