The Adult Education and Family Literacy Act requires states to report learners' educational gains in terms of level descriptors defined by the National Reporting System (NRS). States may choose their assessment methods. Most use standardized testing. NRS level descriptors for English as a Second Language (ESL) define English language proficiency across six levels. The time required to show level gain in proficiency depends on program factors (e.g., class intensity and adequacy of facilities) and learner factors (e.g., age and educational background). Adult ESL standardized tests are easy to administer, valid, and reliable, though they may not capture incremental learning changes over short periods of time. Performance assessment in adult ESL reflects current beliefs that learners acquire language as they use it in social interactions to accomplish purposeful tasks. However, performance assessment for accountability purposes is limited. For both standardized and performance assessments, applying several principles will produce effective assessment procedures (e.g., select assessment instruments and procedures that match learning goals and know assessment limitations). Many critical issues must be examined before putting these principles into practice (e.g., conditions under which measurable gain can be achieved and resources needed to ensure consistent, reliable standardized assessment). (Adjunct ERIC Clearinghouse for ESL Literacy Education) (SM)