Computerized game-based assessment (GBA) system for screening reading difficulties may provide substantial time and cost benefits over traditional paper-and-pencil assessment while providing means also to individually adapt learning content in educational games. To study the reliability and validity of a GBA system to identify struggling readers performing below a standard deviation from mean in paper-and-pencil test either in raw scores and grade-normative scores, a large-scale study with first to fourth grade students (N = 723) was conducted, where GBA was administrated as a group test by tablet devices. Overall, the results indicated that the GBA can be successfully used to identify students with reading difficulties with acceptable reliability. Although the reliability of the results were at a very good level overall, the identification was even better in the reading fluency than in reading accuracy and in terms of raw scores than in grade-normative scores. These findings are the first to demonstrate the promise of GBA in assessing reading skills reliably and in a cost-efficient manner in classrooms. Furthermore, the developed GBA is directly applicable to an educational game for successfully supporting reading development of learners with varying levels of reading skill.