Focusing on the use of "paper and pencil" criterion-referenced tests in educational measurement, and to correct misconceptions, the definitions of basic terms and historical antecedents are discussed. Classifications of the tests are compared with other achievement tests. The phases in developing criterion-referenced tests are presented with the need, development and use of norms. Test uses are categorized and a standard of competence, the setting of cutting scores, and the formative and summative evaluation roles are discussed. Reliability, validity and accuracy are considered in evaluating tests themselves. The summary includes a list of the misconceptions discussed with suggestions on approaches in relating behavioral objectives to test items. The appendices include a problematic method for setting the cutting score and the accuracy analogues of various standard statistics. Tables and figures illustrate the book. (CM)