This study is set to examine EFL teachers' perceptions, views about what makes an effective performance appraisal system by adopting a quantitative survey design for data collection. A total number of 45 college instructors in the Sultanate of Oman responded to survey on: how is an effective performance appraisal perceived by EFL teachers? How do teachers perceive their participation in developing the appraisal system? And how might the present performance appraisal practices be improved? The result reveals that staff participation in developing performance appraisal system and goals, feedback confidentiality, quality appraiser, quality of place and time of appraisal, appraiser-appraisee relationships, and developmental nature of performance appraisal would help in making effective appraisal and the overall PA effectiveness depends mostly on these factors. The result has a significant implication for improving the process of teacher performance appraisal in Oman and enriches the body knowledge of PA in general. The study puts forwards suggestions and recommendations for improving PA practices and exercises in EFL contexts.