There is an extensive international research literature on the impact of ability grouping (e.g. streaming or banding) on children's academic and behavioural outcomes. However, it is questionable to what extent the findings of research on this topic have influenced the practice of pupil ability grouping in New Zealand intermediate schools. Nine intermediate schools in Christchurch were surveyed regarding their policies and practices on pupil grouping. All were co-educational state schools. Principals were interviewed about the types of grouping used in academic subject areas, what they saw to be the benefits and disadvantages of this grouping and also what they saw to be the consequences of these arrangements for average pupils, gifted pupils, pupils with special needs and Maori and Pacific Island pupils. Reported grouping practices, and the views of principals about these, are compared with findings from the literature on ability grouping. The need for schools to adopt more evidence-based strategies for ability grouping are discussed and suggestions for further research are outlined.