Peer assessment has been increasingly integrated in educational settings as a strategy to foster student learning. Yet little has been studied about how students at different learning levels may benefit from peer assessment. This study examined how peer assessment and students’ learning levels influenced students’ project performance by using a two-way factorial design. One hundred and thirty teacher education students participated in this quasi-experimental study. When working on a technology-integrated lesson plan project, the experimental group completed an online peer assessment process while the control group followed the traditional discussion method. Students’ learning levels were measured and divided into low-, average- and high-achieving according to the quality of their draft lesson plans. Data analysis suggested that the impact of peer assessment on students’ lesson plan project seemed to vary according to students’ learning levels. While low- and average-achieving students showed significantly improved performance right after the integration of a peer assessment model, the model seemed to have had less impact on the performance of high-achieving students. Significance, implications and limitations of findings are discussed.