Dynamic assessment (DA) integrates assessment and instruction with the aim of gauging and advancing learning potential. We discuss the conceptual grounding of DA in sociocultural theory, its origins in educational psychology, and applications to second language learning. We present core characteristics – activity, mediation, and modifiability – and approaches to DA, including mediated learning experiences, peer assessment, classroom DA, and technology-based DA. Comparisons to other approaches to classroom assessment are also drawn. We end with a discussion of practical issues with large-scale implementation and future directions in teacher training, technological trends, and theory building in this developing area of L2 assessment.