Criterion-referenced measurement (CRM) has received increasing attention in regular education. However, it is in education for handicapped children that CRM's flexibility for individualization of both instruction and evaluation become even more fully realized. Research is described on one of the first CRM systems (Individual Achievement Monitoring System: IAMS) ever devised exclusively for the handicapped and designed for widespread implementation. Methodological problems are discussed, such as inappropriateness of item sampling, difficulties in retention testing, and determination of adequate criterion levels of mastery for handicapped children. Flexibility of research findings based on CRM is also examined. (Author)