Assessment of students' performance is an integrated part of education process and it frequently causes school anxiety. School anxiety is one of the most common fears experienced by children. It develops because of inadequate rapport between the teachers and the students, parents' unrealistic expectations or because of the fear of failing a test. Test anxiety can be overcome through the maturation process and adaptation to the school environment, but more often it is due to the parents' or teachers' help. It is believed that teachers can help their students to diminish test anxiety and improve their academic performance by implementing effective strategies into practice. Formative assessment is one of those strategies because it improves learning and adapts teaching. The aim of this paper is to determine the difference in the level of school anxiety among students whose teachers use methods of formative assessment in their teaching and those who do not use them. Additional independent variables were gender and school achievement. The research was conducted using the sample of 79 fourth-graders from four different primary schools in Zagreb. The research shows significant differences in experiencing school anxiety between the students whose teachers use methods of formative assessment and the students whose teachers do not use them. Surprisingly, the students whose teachers practice formative assessing experience significantly higher level of school anxiety relative to the students whose teacher do not practice it, which means that they are more inclined to avoid school, possess more psychosomatic symptoms, exhibit greater fear of test situations in their dreams. Furthermore, the research shows a significant difference regarding the gender, meaning that girls experience lower school anxiety relative to boys. It has been showed that there is a partial significant difference regarding school achievement.