This study, as a preliminary exploration, aims to explore significant theoretical approaches to situation from the situated literacy perspective in order to find possible meaningful directions for situation-based assessment. This study suggests three key elements for situation-based assessment: the core level of the situation, the authenticity level of the assessment, and the agency level of the test-takers. The core level of the situation defines to what degree the situation is regarded as the core value in developing assessment tasks. The authenticity level of the assessment refers to the degree to which the assessment tasks have an authentic purpose and/or are similar to literacy practices that happen in the test-takers’ daily lives. The agency level of the test-takers refers to the degree to which the assessment tasks provide possibilities for test-takers’ active/ agentive construction of situations. Focusing on these key elements, this study proposes meaningful directions for situationbased assessment: assessment providing specific communication scenarios, reflecting actual literacy ecosystems, and allowing test-takers opportunities for constructing interactional situations.