Tests of clinical competence, which allow decisions to be made about medical qualification and fitness to practise, must be designed with respect to key issues including blueprinting, validity, reliability, and standard setting, as well as clarity about their formative or summative function. Multiple choice questions, essays, and oral examinations could be used to test factual recall and applied knowledge, but more sophisticated methods are needed to assess clincial performance, including directly observed long and short cases, objective structured clinical examinations, and the use of standardised patients. The goal of assessment in medical education remains the development of reliable measurements of student performance which, as well as having predictive value for subsequent clinical competence, also have a formative, educational role.