This paper addresses the use of computer-based testing in distance education, based on the experience of Universitas Terbuka (UT), Indonesia. Computer-based testing has been developed at UT for reasons of meeting the specific needs of distance students as the following:

• students‘ inability to sit for the scheduled test,
• conflicting test schedules, and
• students‘ flexibility to take examination to improve their grades.

In 2004, UT initiated a pilot project in the development of system and program for computer-based testing method. Then in 2005 and 2006 tryouts in the use of computerbased testing methods were conducted in 7 Regional Offices that were considered as having sufficient supporting recourses. The results of the tryouts revealed that students were enthusiastic in taking computer-based tests and they expected that the test method would be provided by UT as alternative to the traditional paper and pencil test method. UT then implemented computer-based testing method in 6 and 12 Regional Offices in 2007 and 2008 respectively. The computer-based testing was administered in the city of the designated Regional Office and was supervised by the Regional Office staff. The development of the computer-based testing was initiated with conducting tests using computers in networked configuration. The system has been continually improved, and it currently uses devices linked to the internet or the World Wide Web. The construction of the test involves the generation and selection of the test items from the item bank collection of the UT Examination Center. Thus the combination of the selected items compromises the test specification. Currently UT has offered 250 courses involving the use of computer-based testing. Students expect that more courses are offered with computer-based testing in Regional Offices within easy access by students.