The discovery rule is a common law doctrine that often applies to cases in which a statute of limitations is involved. A statute of limitations is a set period of time in which a lawsuit is considered reasonable; once beyond this set period of, a party that wants to sue may have no legal recourse. The discover rule suggests that the statute of limitations begins, not at the time of the unlawful event, but rather from the time that the suing party became aware of the breech. The discovery rule is unevenly applied, and may be discarded by judges who disagree with the claim.

The discovery rule is important because unlawful acts do not always have immediately known or foreseeable consequences. If a worker is unknowingly exposed to harmful chemicals, leading him or her to develop a serious medical disease ten years later, the discovery rule suggests that the statute of limitations on suing a negligent employer would begin when the illness was first detected, not at the time of the unwitting exposure. Medical cases such as this frequently employ the discovery rule to call for an adjustment of the statutes of limitations on issues such as malpractice or employer negligence.

One critical factor in the success of invoking the discovery rule is due diligence on the behalf of the injured party. If, in the example above, the worker had consistent symptoms throughout the ten year period, but did not get medical attention until the ten year mark, a judge could decide that the worker had not shown due diligence. This is one of the issues that makes the application of the discovery rule somewhat subjective, as it is up to the individual judge to decide what the injured party could or should have known.

Traditionally, the discovery rule has not applied to mass media libel cases. This means if a person insults someone in a published book, the statutes of limitation for a libel case generally apply, even if the injured party does not find out about the book for many years. The justification for this is that the book was publicly available and at any time open to discovery. In recent years, this exclusion has been challenged by the massive use of the Internet. Critics of mass media exclusion suggest that, while public, libel on a blog or personal website may be nearly impossible to find unless a plaintiff knows exactly the right search terms to use.

One famous case that chose to exclude the discovery rule was the US Supreme Court case of Ledbetter v. Goodyear Tire and Rubber Co. In this landmark case, Lilly Ledbetter sued the company for pay equity violations, after discovering she had been paid substantially lower than comparable male colleagues for 19 years. The Supreme Court ruled that since she had not brought the charges within the statute of limitations from the initial discrepancy, the suit was invalid. This became a major topic of discussion in the 2008 presidential election, and led to the newly elected President Obama choosing the Lilly Ledbetter Pay Equity Act as his first signed law. The new law specifically allows prior instances of discrimination to be incorporated into pay equity lawsuits, even after the statute of limitations expire.