A good assessment system is one of the preconditions for quality education. Formative assessment is comparatively an emerging idea to assess the students throughout the academic year with the intention to identify and overcome the weaknesses of the students and enhance their learning outcome. Taking these into account, this study attempted to explore the teachers' perceptions of the use of formative assessment in enhancing teaching and learning in Bangladesh higher education. A mixed-method study was employed with survey and semi-structured interview as the data collection methods. 100 participants were randomly (simple random) selected for the survey, and 6 participants were purposively selected for the interviews. For analysing the data, descriptive analysis and content analysis were used. The findings of the study revealed majority of the participants agreed that formative assessment is crucial to enhance teaching and learning in Bangladeshi colleges. Nonetheless, there are some challenges like - teachers' biasness, shortage of teachers, large class, poor infrastructure, insufficient power supply, and heavy workload of the teachers. As a whole, this study will provide a fundamental ground for future research in formative assessment in Bangladeshi colleges specifically and for comparative study with other higher education institutions globally.