Today there are dozens of instruments that claim to measure leadership capacities. Although every instrument has limitations and must be used carefully, the tests can be used to identify leadership potential. This digest summarizes the reasons for using formal assessments, the attributes measured by such tests, the ways in which leadership potential is measured, and the limits of formal assessment. It is recommended that school district personnel make sure that the test closely matches the demands of the position; determine whether the test satisfies basic statistical criteria such as validity and reliability; and carefully interpret test results. (LMI)