The progress of students and schools in California is examined by reviewing the state's recent test history and the state's progress in creating a sound, standards-based assessment system. The story about California is mixed. Overall performance on the Stanford Achievement Test, ninth edition (SAT-9) shows that the state average, overall grades and all subject matters, is below the national average. However, when allowance is made for the state policy that requires all students who have been in school 1 year to take the test regardless of their English proficiency, California students are around the national average. When achievement is examined through standards-based measures, of which the National Assessment of Educational Progress is an example, California's performance looks poor, especially when one considers the performance of children in poverty. What will be important to consider is whether performance rises as instruction becomes more relevant to the standards the assessments are measuring. The report offers recommendations for the best development of the California assessment system. Two appendixes contain the figures and tables. (Contains 67 figures, 6 tables, and 22 references.) (SLD)