The purpose of the study was to investigate if academic and social self-concept and motivation to improve in academic school subjects mediated the negative effect of summative assessment (grades) for low-ability students' achievement in compulsory school. In two previous studies, summative assessment (grading) was found to have a differentiating effect on students' subsequent achievement in school (Klapp et al. 2014; Klapp 2015). Differences between subgroups of students (cognitive ability, gender, and socioeconomic status) were controlled for in the analyses. Data was retrieved from the Evaluation Through Follow-up (ETF) longitudinal project containing register and questionnaire data on a large national representative sample of Swedish compulsory school students (N = 8558). Due to a unique natural circumstance, municipalities in Sweden could decide whether or not to grade their students in sixth grade which made it possible to apply a quasi-experimental design. In the sample, 50% of the students were graded in sixth grade while all students were graded in seventh grade. Confirmatory factor analysis (CFA) and structural equation modeling (SEM) have been estimated. The results show that the negative effect of summative assessment (grading) for low-ability students on their subsequent achievement is fully mediated by academic self-concept in mathematics and Swedish, and motivation to improve in academic school subjects.