Despite the recommendations of some measurement specialists, teachers do not always assign grades based on achievement only. The primary purpose of this study is to clarify the meaning of grades, and to examine some of the factors teachers consider when assigning final grades with a focus on borderline cases. The sample consisted of 516 American public school teachers, selected via stratified random sample in a major metropolitan school district in the Southeast. A 53-item survey using Guttman's mapping sentences, previously piloted in a separate school district, was created and distributed. Teachers were provided with scenarios that described student ability, achievement, behavior, and effort and the teacher was asked to assign both a numerical and letter grade. A four-way between-subjects ANOVA was conducted with the student characteristics ability, achievement, behavior, and effort as independent variables and final grade as the dependent variable. Findings demonstrate that teachers abided by the official grading policy of the participating school district assigning grades based primarily on achievement under most circumstances, however, in some borderline cases teachers report considering non-achievement factors. Implications for pre-service and in-service professional development are discussed. (Contains 8 figures and 3 tables.)