To drop the lowest score in a series of items, such as quizzes, you first need to create a category and move the items into it. To learn about creating categories, this guide describes how to set up your gradebook if you weight your grades, while this guide describes setting up your gradebook for straight points.

To drop the lowest item in a category (each step corresponds to an image on the right):

1. Click on the Edit pull-down menu associated with the category name, then select Edit settings.
   
   
   
   
2. In the Grade category option area, click on Show more to display more options.
   
   
   
   
3. In the Keep the highest field, enter the number of scores that you want Moodle to keep. In this example, there are four quizzes, so if I want Moodle to drop the lowest score, I'll enter a three in this field, then Save changes.
   
   
   
   
4. After saving, a note is displayed under the category description that indicates that the scores will be adjusted as desired. In this case, the top three out of four quiz scores will count. This note will also appear in the student's grade view.

Bonus Explanation

Why didn't we set the drop lowest option to one, since that's the desired effect?

When you use the "drop lowest" option, the lowest score will be dropped from the beginning of the term. Thus, a student may not perceive a problem with quiz scores (for instance) since a failed quiz won't be factored into the category total — not until a worse grade is achieved on a subsequent quiz.

By keeping the highest, all scores earned up until the last quiz is taken will be factored into the category total, giving students a more accurate view of their overall grade throughout the term.