Interest in assessment of young children increased after readiness testing abuses in the 1980s. The pressure of demonstrating educational accountability through children's standardized test performance increased the use of skills-driven curricula. It also created an inappropriate learning environment in which readiness tests were used to remove from the classroom children who could not meet the inappropriately high standards. Legitimate purposes for early childhood assessment include educational planning and communication with parents, identifying children with special needs, and program evaluation and accountability. Assessment instruments should be matched to the type of information needed. Portfolio assessment is gaining popularity among educators and appears to be well matched to developmentally appropriate early childhood programs. As a purposeful collection of student work illustrating effort and progress in given areas, portfolios allow teachers to observe development, evaluate the curriculum, determine efficacy of teaching practices, and facilitate faculty discussion. They provide an avenue for student self-evaluation, goal-setting, and learning opportunities. Establishing guidelines for portfolio inclusion highlights the learning goals. However, there are problems in using portfolios, including inconsistent reliability and validity of portfolio scores. Contents for a preschoolers' portfolio will vary from those used in elementary school. The portfolio is best organized chronologically according to developmental areas. Children should be allowed to examine work samples and contribute to portfolio selection. Evaluation criteria provide the framework for thinking about student performance and clarify instructional goals. Systematic observation is important for collecting information for preschoolers' portfolios. (KDFB)