ABSTRACT Human Computer Interaction (HCI) is concerned with the design, evaluation, and implementation of interactive computing systems for human use. User interfaces that are designed based on HCI principles are more effective for users and organizations. Within the medical field, the reality of medical errors is that they are seldom due to carelessness or negligence. More commonly, errors are caused by faulty systems design. This research attempted to assess the application of user needs assessment and evaluation in iterative, user-centered design of a system for the purpose of designing a complex system while involving users in every stage of the design process. The Phoenix Health Information System 2 (PHIS2) was a redesigned system of PHIS currently used in King Abdulaziz University Hospital. PHIS was formally evaluated by novice and expert users from the hospital to identify problems they were having with the system. The researcher concluded from the evaluation that all the problems found based on the commonly used tasks doctors perform on a daily basis were a violation of HCI principles found within the literature: Mental Model, Metaphor, Visibility, Affordance and Feedback. Based on this research's developed design guidelines, three prototypes of the new system PHIS 2 were developed: low, medium and high fidelity prototypes. Each prototype was piloted with experts and formally tested with novice users. At every stage, suggestions and problems were analyzed and the system's design was updated and the final version of the design was then programmed to be a fully functional high fidelity prototype. Results of the formal evaluation of PHIS2 reveled that the system was accurate in terms of performing tasks in excellent or acceptable time, efficient and effective in terms of limited number of wrong menu choices and wrong icons selected and was easy for the user to use even with no training what so ever. The use of an iterative, user-centered approach resulted in great improvements to the design of the current system and allowed the researcher to test successive approximations of the ""final"" system.