We are at a critical moment for assessment in schools. Teachers are called to navigate advances in classroom assessment research, top‐down assessment policies, and lingering effects of the COVID‐19 pandemic on teaching and learning. Embedded in this context are also systemic challenges to teachers’ assessment practice. This paper analyses these challenges to characterise the current context for teachers’ assessment work and considers teachers’ innovative responses to these challenges. Data are drawn from 168 qualitative responses to a baseline assessment innovation survey across 10 Canadian provinces and territories as well as 10 other international jurisdictions. Eight themes were identified related to teachers’ assessment challenges and innovations, including: negating innovation, the emotions of assessment, grade obsession and the gradeless spectrum, conflicting orientations towards assessment, the use of ‘assessment talk’, data overload, equitable assessment and actions that make learning and assessment visible. These findings directly support the widespread goal of implementing assessments that effectively and consistently serve student learning. The paper concludes with a discussion on how teachers move from facing assessment challenges to engaging in assessment innovations.