Excerpt: "What makes something sacramental? Have you ever thought about that question? The classic answer, going back to St. Augustine, is that a sacrament is an outward and visible sign of an inward and spiritual reality. During the Middle Ages, the church embraced as many as 30 sacraments, but Peter Lombard reduced them to the seven that are still a part of the Catholic faith. With Luther and the Reformers, the number was reduced to two- as water baptism and communion are the two most closely connected to New Testament practices. But what is it that really makes something sacramental? Or put otherwise, what is the character of sacramentality?"
Anderson, Paul N., "On Christmas... and the Character of Sacramentality" (1992). Faculty Publications - College of Christian Studies. 315.