Performance assessment is reviewed as an emerging form of alternative assessment, focusing on how it has been defined in the research literature, the criteria for evaluating its authenticity, the measurement of process and product, and the link between assessment and instruction. Three important dimensions that must be considered in describing performance tests are the extent to which test is authentic (simulating real life), what is actually being evaluated, and the basic response format of the task. In evaluating authenticity, it is necessary to consider structure and design, grading and scoring, and fairness and equity. Performance tests can focus primarily on the product or on the process, and it is important to recognize where the focus lies. The basic types of response situations include oral, written, and graphic representation tasks. Good instructional activities may inform the design of good assessment tasks, but it cannot be assumed that authentic assessment will automatically result in classroom activities that are more conducive to learning. In practice, a compromise between multiple-choice tests and full-blown simulations of actual situations can be found, even though this may not be the highest form of performance assessment. (SLD)