Western philosophy has been built upon the idea of discrete categories. Pragmatics differs from this tradition by allowing a certain fuzziness and ambiguity in conceptual categories. Pragmatics also carries with it a new mode of inference which has been labeled by C. S. Peirce "abductive inference." Abductive inference has been likened to the intuitive hypothesis generation and verification used by scientists. This paper proposes that abductive inference is employed by listeners under some conditions of language comprehension.The continuum between types of logical categories also corresponds to a continuum of cognition. One end of the continuum is typified by rigid, algorithmic, automatic processing. The other end features flexible, attended processing that is less dependent on rigid categories. When a listener is confronted with novel or unexpected utterances, the listener employs abductive inference in an attended processing mode to form a hypothesis about what is being said. The encoding of intent becomes the encoding of cues that guide the listener to a particular hypothesis.