The Point-Diffraction Interferometer (PDI) forms a spherical reference wavefront at the image of a point source, as produced by some optical system under test, by diffraction at a point-like discontinuity. The reference wavefront interferes with the directly transmitted light, forming an interference pattern that represents a direct and accurate measure of the wavefront aberration. Fringe visibility can approach unity by appropriate design of the interferometer. These principles and performance characteristics are briefly reviewed. By virtue of its operation, the PDI provides precise information about the location of an image relative to the interferometer aperture, with measurement precision intrinsic to two-beam interferometry. It is shown that high internal and external alignment precision of an optical system is possible using a PDI.