Purpose <p>Biomedical engineering (BME) design courses require students to develop professional competencies through iterative design, feedback, and teamwork. However, traditional points-based grading systems are poorly aligned with these learning goals. Specifications grading has been proposed as an alternative assessment approach that emphasizes mastery and revision, yet its implementation in team-based engineering design courses remains underexplored. This study investigates the impact of specifications grading on student mastery, professional competency development, and student experience in a third-year BME design course.</p> Methods <p>A mixed-methods approach was used to evaluate the implementation of a specifications grading system in a BME design course. Quantitative grade analyses compared student performance under specifications grading with two previous course offerings assessed using points-based grading. Qualitative data were collected through structured final reflections and focus groups conducted at multiple points during the term to examine students’ perceived professional skill development and experiences with the grading system.</p> Results <p>Students demonstrated comparable performance to previous cohorts on initial submissions and showed improved mastery of written, technical, and design deliverables following opportunities for revision. Students identified gains in professional competencies including communication, feedback integration, organization, and leadership. However, focus group data revealed grade anxiety and perceptions of increased workload and rigidity.</p> Conclusion <p>Specifications grading supported improved mastery of written and technical deliverables in a team-based BME design course and was associated with perceived gains in professional competencies; however, students reported increased anxiety and workload. These findings highlight the importance of careful alignment between grading structures, workload, and communication when implementing specifications grading.</p>