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Maybe i'm totally off here but I assume at some point early in law school I'm gonna have to start thinking about areas and specialties to potentially practice (mainly concerned with litigation vs transactional) and am curious to know how most guys arrive at their decisions.

When must one make the decision to commit to litigation or transactional?
Are there opportunities to hear feedback in law school regarding one's potential as a litigator to prevent disillusionment?

You should have some idea by the middle of your 1L summer. Your choice of transactional or lit will affect where you bid and what offer you accept at OCI for your 2L summer. That said, it's OK to be less than 100% sure. A lot of employers let you try out different practice areas and see what you like.