The paper investigates abduction as a methodology for theoretical discovery in qualitative social and educational sciences. Abduction is now an established concept in the methodological literature. Abduction gives means for ‘theorising’, to describe and help to explain how theoretical concepts are constructed during the qualitative research process. Methodologically abduction is also trying to respond to the challenge of generalisation in qualitative research that is based on the singular and unique. However, the actual practice and nature of abductive inquiry remain somewhat mysterious in the methodological literature. In this paper, we discuss and develop different interpretations of abduction as a basis for forming solid methodology of abductive analysis. Abduction operates at different methodological 'layers' which makes it challenging but at the same time a fruitful methodological concept. In this paper, we discern three layers of abduction in the methodological literature: 1) Abduction used for opening up methodological questions on theory construction with related epistemological and philosophical challenges, 2) Abduction interpreted as methodological model that delineates long term processes of concept formation (within one research project, or also across individual research projects), 3) Abduction helping to conceptualise detailed analytic steps and processes in qualitative research. We explicate the role of abduction in each phase of the research process from lived through experiences in the field to generating concepts in working with data to articulating and testing new concepts to and with wider audiences and settings. We give examples of practical decisions related to abduction during the research process through our own work doing participatory ethnography and discourse analysis.