Assessment in (physical) education remains challenging, both from a pedagogical and motivational perspective. How can teachers assess students in a more motivating way while teaching in contemporary—performance grade-driven—physical education? The scarce evidence available does not provide sufficient basis to conclude that the presence of grading in itself negatively impacts students’ motivational functioning in physical education. It is important, next to grades, to inform students about goals and to provide step-by-step guidance in their learning progress. This is important because when students are well-informed about their progress in learning and aware of their effectiveness in the task at hand, judgments of the quality of their learning such as grades are potentially no surprise to these students, and therefore may not affect students’ motivational functioning negatively. This chapter aims to provide insights in the potential contributions and consequences of various functions of assessment to students’ motivation. We discuss why teachers assess in general and in physical education, and why this is challenging. Moreover, we discuss the relation between assessment and students’ motivation in general and in physical education. Finally, we end this chapter with practical recommendations and suggestions for future research.