The growing numbers of brown dwarfs have largely been divided into two new spectral classes, L and T. Subclassification systems for L, based on optical (0.6–1.0 μm) spectra, have existed since 1999, but there is a need for infrared systems for both spectral classes. The differences in the infrared (1.0–2.5 μm) characteristics of L spectra and T spectra observed prior to 2000 are huge, all then-known T dwarfs showing strong methane absorption bands, and all L dwarfs devoid of these bands. However, in the last 2–3 years a significant number of brown dwarfs with infrared spectra in transition between the L and first observed T types have been discovered. The spectra of late L dwarfs and these “transition objects” can be put into a well ordered sequence of increasing H2O and CH4 band strengths and decreasing CO band strengths. Specific infrared spectral indicators have been found that allow the L and T sequences to be linked and the boundary between L and T to be precisely defined. In current T classification schemes the transition objects are defined as early T dwarfs. We recommend that the boundary between the L and T classes be defined as the first appearance of methane absorption just longward of 1.60 μm, in the H band.