This study documented current early childhood assessment policies and practices, focusing on changes since the 1988 nationwide survey and on changes occurring in response to Goal 1 of the National Education Goals, performance assessments, and integrated services for young children. Data were collected through telephone surveys and in-depth interviews with the state-level early childhood or elementary coordinator or testing director, as well as Part H and IDEA coordinators, Title I coordinators, Head Start directors, and the Goals 1 contact person. Documentary evidence of policies or legislative mandates was also obtained. The findings, in descending order of prevalence, follow: (1) most states have made an effort to move away from readiness testing and kindergarten retention, and there is a perceived reduction though not elimination of these practices; (2) almost all state-mandated standardized testing for school accountability has been eliminated for children below grade 3; (3) some states and local districts are moving to new assessment forms in the early grades that are more supportive of instruction; (4) misuse of screening instruments for instructional purposes has decreased since 1988; (5) professional training is needed to understand and use new assessment forms; (6) preschool testing is largely driven by mandates for categorical programs; (7) a few states are collecting data to report on progress toward Goal 1; (8) parent involvement was an issue both for identifying children with special needs and because of parent demands for standardized testing; and (9) lack of collaboration and coordination among agencies serving young children continues to be a problem. (Contains 16 references.) (KB)