The purpose of the research is to investigate the behaviour of school personnel under two assessment-reporting conditions and school functioning when faced with the choice of excelling in high-stakes tests or catering to local educational needs. The functioning of 60 schools was compared in terms of their preparation for high-risk external tests and for low-stakes tests, of the same level of difficulty. The study examined the practices of school principals, subject coordinators and teachers, communication with parents and the ethical behaviour of the school staff. In all the comparative measures, many more school resources were invested in preparation for high-stakes tests than for internal tests. This investment came at the expense of formal and informal cutbacks in studies for non-test subjects. A clearer, more comprehensive analytical picture of the behaviour of school personnel is obtained about differences in school functioning when external and internal tests are administered.