National paper and pencil exams could be consigned to history and replaced with online versions that are tailored to how well students are completing tests.
Students would answer a series of literacy and numeracy questions and an algorithm uses their responses to choose the next lot of questions from sets of varying difficulty.
The Australian Curriculum, Reporting and Assessment Authority has found tailored test design engages students more in assessments because they are adjusted to an individual's need during a test.
It's a key part of moving to online assessment, which the federal government has pledged to do for NAPLAN tests.
The authority's assessment and reporting manager Stanley Rabinowitz said this was the future of assessment.
"We will get better, quicker results to benefit government, schools, parents, teachers and students," he said.
"We expect to see more engaged students and better informed teachers and parents."
ACARA CEO Robert Randall said tailored NAPLAN testing yields more precise results for teachers and education departments.
"What it means is, with this online assessment, is we're able to tailor the tests to reflect what the students are demonstrating in their responses, and that gives us more accurate assessment."
"At the moment, where everyone exactly sits the same test, the more able students, we're just finding out, we're not stretching them, we're actually finding out they're actually able to get close to all the items right, and so that is of limited value. We need to stretch them a bit, and see how far up that scale they actually are."
SBS Radio's Angelo Risso speaks with ACARA CEO Robert Randall
Education Minister Christopher Pyne said moving NAPLAN tests online and getting the results back quicker would let schools better work out how to help students.
After two years of research, ACARA found the adaptable tests gave a better measurement of student performance, especially for those at the high and low extremes.
It also found students felt more positive and accomplished after taking the online tailored testing, regardless of their abilities.
One of the criticisms often levelled at NAPLAN is that students feel unduly pressured and stressed about the testing. The research in 2013 involved 2500 primary school and 1500 high school students.
The next stage of research started in August to further refine the tests. It will also trial delivering grammar, punctuation and spelling tests online.
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