Although the usefulness of alternative assessment in second language (L2) classrooms has been extensively recognized by scholars, the use of the various types of alternative assessment in English as a Foreign Language (EFL) contexts has not received adequate attention by L2 practitioners. To contribute to this line of research, the present research sought to examine the impact of a portfolio-based writing instruction on writing performance and writing anxiety of EFL students. To this end, a number of 41 EFL learners were recruited as the participants of this study. They were then randomly divided to an experimental group (N=21) and a control group (N=20). The participants in the experimental group received portfolio-based writing instruction, whereas the control group received the regular writing instruction with no archiving of students’ drafts in portfolios. Timed-writing tasks and the Second Language Writing Anxiety Inventory (SLWAI) were employed to collect the data. The results obtained from ANCOVA analysis revealed that the portfolio-based writing instruction aided the participants in improving their writing performance more than the control group. Moreover, it was found that the use of portfolios significantly reduced the L2 writing anxiety of the participants while the traditional writing instruction did not have any significant impact on L2 writing anxiety of the control group. The pedagogical implications for portfolio-based writing instruction are discussed finally.