Many applications dealing with textual information require classification of words into semantic classes (or concepts). However, manually constructing semantic classes is a tedious task. In this paper, we present an algorithm, UNICON, for UNsupervised Induction of CONcepts. Some advantages of UNICON over previous approaches include the ability to classify words with low frequency counts, the ability to cluster a large number of elements in a high-dimensional space, and the ability to classify previously unknown words into existing clusters. Furthermore, since the algorithm is unsupervised, a set of concepts may be constructed for any corpus.