Many educators are shifting their teaching strategies and approaches to include more emphasis on critical thinking skills, the communication of ideas, a variety of approaches to content emphasizing varied student learning styles, and the need to draw explicit connections among topics for retention of learning. Real-world assessment measures, then, are derived from observing actual performance or relatively high-fidelity simulations of actual performance. Alternative assessment is aimed at teaching students to think, to react to new situations, to review and revise work, to evaluate work, and to communicate results. Problems with current assessment methods are traced, and guidelines are presented for authentic assessment. Myths that exist about alternative assessment include the assumptions that it shortchanges the average student and that it consists of nothing more than "touchy, feely" activities. It is also incorrect to assume that alternative assessment does not provide clearly defined performance standards, or that it requires too much of the teacher's time. A second article in this Policy Brief reviews "Authentic Assessment in AEL's Region." Authentic assessment practices in the states of the Appalachia Educational Laboratory (AEL), Kentucky, Tennessee, Virginia, and West Virginia, are providing examples of educational innovation in assessment. Three tables summarize details about alternative assessment. (Contains 21 references.) (SLD)