Performance-based assessment has the potential to support a richer curriculum and more accurately assess the skills of low-income minority students than standardized tests. Performance-based assessment has the following advantages: (1) it allows a wide range of expression; (2) it permits assessment of learning in a natural context while students make active use of a skill; (3) it assesses a wide range of competencies; (4) it requires students to demonstrate mastery in a personal and integrated way; and (5) it has "ecological validity," because students perform as they will have to in life. The following types of performance-based assessments are described: (1) station activities, which require students to proceed through a series of discrete tasks, either individually or in teams, in a given amount of time; (2) domain projects, which require students to complete a set of exercises designed to explore an idea, concept, or practice central to a particular academic or artistic domain; (3) portfolios, which consist of several projects completed in a sequence to show progress with a subject; and (4) videotapes, which can show students performing or being interviewed. While performance-based assessment methods appear to be reliable, such assessments are expensive to score when compared to mechanically scored standardized tests. Moreover, there are indications that performance-based tests might result in lower scores for low-income and minority students unless there were accompanying changes in teaching methods. Finally, the pressure for mandated performance-based testing could still result in narrowly focused teaching geared to the new assessment methods. A list of 13 references is appended. (FMW)