This study describes the development process and examines the construct validity of an English placement test of oral communication (EPT OC) developed at a Midwestern university in the United States. This test includes a one‐on‐one oral interview and paired discussion task, and test performance is judged on an analytic rating scale. A confirmatory factor analysis conducted on the ratings of 338 students who took the initial fully operational EPT OC revealed the test structure was represented by a correlated four‐factor model with interactional competence, fluency, pronunciation/comprehensibility, and grammar/vocabulary as sub‐constructs, in line with its targeted theoretical framework. Both tasks were effective in measuring the targeted sub‐constructs, but the sub‐constructs were not sufficiently distinct from each other to completely justify a four‐factor model. The findings provide some support for the proposed interpretations of the EPT OC test scores but indicate the need for some modifications to the assessment, such as more thorough rater training and/or revised rating scales to better distinguish the targeted sub‐constructs.