States have been restructuring their U.S. history state assessments to include literacy-intensive reading and writing assessment items that have the potential to evaluate students' historical literacy skills in high-stakes testing environments. The purpose of this study was to explore how the restructuring of a U.S. history state assessment with the addition of an extended-response item was associated with an increase in the income-achievement gap and to explore the role urbanity status played in student performance by school income level. An assessment item analysis as well as difference-in-means and multiple-regression statistical analyses were used in this study. The findings first identified that the extended-response item presented higher levels of academic language demand, historical thinking demand, and historical literacy demand than the multiple-choice items. Second, the quantitative analyses identified an income-achievement gap between students from low-income schools and students from non-low-income schools, with students from low-income urban schools underperforming all other income levels and urbanity categories. The findings suggest a performance gap may exist for some students on the extended item that may be contributed to underdeveloped language, historical thinking, and historical literacy skills.