Although increasing numbers of students with disabilities are included in general education classrooms for greater portions of the day, little guidance or direction has come from the field of special education to help address the challenge of grading students in inclusive settings. The shift to standards-based grading and reporting has further complicated grading students with disabilities who are included in general education classrooms. Although grading all students in special education on the basis of grade-level standards is inappropriate, most of the practices recommended to date are not well suited to a standards-based grading system. To provide meaningful and interpretable indicators of achievement that are useful for making accurate decisions about students in special education, more effective grading practices are sorely needed. Before considering grading methods specific to students in special education, schools must have a high-quality grading and reporting system in place for all students. One fundamental component of a high-quality grading and reporting system requires teachers to consider three distinct types of learning criteria: (1) Product criteria; (2) Process criteria; and (3) Progress criteria. Once a school has in place a high-quality grading and reporting system that separates product, process, and progress learning goals, educators can develop appropriate policies and practices for grading students with disabilities who are included in a standards-based learning environment. The 5-step Inclusive Grading Model presented in this article is designed to fit a standards-based grading and reporting system and meet legal requirements for reporting progress of students who have IEPs. The 5 steps of the model consist of the following: (1) Determining whether an accommodation or a modification is needed for each grade-level standard; (2) Establishing the appropriate modified standard for each area requiring modification; (3) Outlining any additional goals pertinent to the child's academic success; (4) Applying equivalent grading practices to the appropriate standards; and (5) Clearly communicating the grades' meaning. (Contains 1 figure.)