In this digital ITEMS module, Dr. Hong Jiao and Dr. Manqian Liao describe testlet response theory for the construction and evaluation of new measures and scales. They start with an introduction to the needs of testlets when local item dependence is present and then introduce the basic testlet response models proposed from different theoretical frameworks built upon standard item response theory models. Furthermore, they introduce different methods for model parameter estimation and related software programs that implement them. Finally, they showcase further extensions of the extended testlet response models for more complex local item dependence issues in innovative assessment. The module is designed for students, researchers, and data scientists in various disciplines such as psychology, sociology, education, business, health and other social sciences in developing testlet-based assessment. It contains audio-narrated slides, sample data, syntax files, diagnostic quiz questions, data-based activities, curated resources, and a glossary.