The field of pairwise clustering is currently dominated by the idea of dividing a set of objects into disjoints classes, thereby giving rise to (hard) partitions of the input data. However, in many computer vision and pattern recognition problems this approach is too restrictive as objects might reasonably belong to more than one class. In this paper, we adopt a game-theoretic perspective to the iterative extraction of possibly overlapping clusters: Game dynamics are used to locate individual groups, and after each extraction the similarity matrix is transformed in such a way as to make the located cluster unstable under the dynamics, without affecting the remaining groups.