Formative assessment is the process by which teachers provide information to students during the learning process to modify their understanding and self-regulation. An important process within this is shared assessment, which refers to student involvement in the assessment and learning practice, a process of dialogue and collaboration between teacher and students aimed at improving the learning process, both individually and collectively. The purpose of this paper is to review the current state of affairs in depth. This paper therefore highlights, on the one hand, the lessons learned through research and development in higher education (i.e. providing clear learning goals and feedback, guiding learning, involving students in learning and assessment, promoting feedback as a process of dialogue, and making processes viable). On the other hand, these lessons also suggest some challenges and difficulties that must be addressed in the future in order to further improve formative and shared assessment in higher education. These include the need for more research on its effects, further conceptual clarification, the intersubjectivity of the process, recognition of the divergent processes and ethical principles, students' involvement not only in assessment but also in determining academic grades, and broadening learning goals and objectives in FA & SA.