Teachers' perceptions of their students’ academic skills are crucial in enabling teaching at the appropriate level and shaping learning processes. We examine how accurate are teachers’ perceptions for low achieving students using data collected from around 1,800 primary school teachers across 848 schools in rural India. We find that around 40% of teachers inaccurately perceive that the low performing students in their classroom had already acquired foundational literacy, when they have not. Female teachers, para-teachers, and teachers with lower work burden are more likely to have accurate perceptions of low performing students. Our study highlights the need to work with teachers to ensure more realistic perceptions in order for pedagogical approaches like teaching at the right level to reach its intended impact.