A single examination does not fulfill all the functions of assessment. The present study was undertaken to determine the reliability and student satisfaction regarding the objective structured practical examination (OSPE) as a method of assessment of laboratory exercises in physiology before implementing it in the forthcoming university examination. The present study was undertaken in the Department of Physiology of Melaka Manipal Medical College, Manipal Campus, India. During the OSPE, students were made to rotate through 11 stations, of which 8 stations were composed of questions that tested their knowledge and critical thinking and 2 stations were composed of skills that students had to perform before the examiner. One station was kept as the rest station. Performance of the students was assessed by comparing the students' scores in the traditional practical examination (TPE) and OSPE using “Bland-Altman technique.” Student perspectives regarding the OSPE were obtained by asking them to respond to a questionnaire. The Bland-Altman plot showed that ∼63% of the students showed a performance in the scores obtained using the OSPE and TPE within the acceptable limit of 8; 32% of the students scored much above the anticipated difference in the scores, and the rest scored below the anticipated difference in the scores on the OSPE and TPE. Feedback indicated that students were in favor of the OSPE compared with the TPE. Feedback from the students provided scope for improvement before the OSPE was administered for the first time in the forthcoming university examination.