The financial and geologic advantages of drilling slim holes instead of large production wells in the early stages of geothermal reservoir assessment has been understood for many years. However, the practice has not been fully embraced by geothermal developers. We believe that the reason for this is that there is a poor understanding of testing and reservoir analysis that can be conducted in slim holes. In addition to reservoir engineering information, coring through the cap rock and into the reservoir provides important data for designing subsequent production well drilling and completion. Core drilling requires significantly less mud volume than conventional rotary drilling, and it is typically not necessary to cure lost circulation zones (LCZ). LCZs should be tested by either production or injection methods as they are encountered. The testing methodologies are similar to those conducted on large-diameter wells; although produced and/or injected fluid volumes are much less. Pressure, temperature and spinner (PTS) surveys in slim holes under static conditions can used to characterize temperature and pressure distribution in the geothermal reservoir. In many cases it is possible to discharge slim holes and obtain fluid samples to delineate the geochemical properties of the reservoir fluid. Also in the latter case, drawdown and buildup data obtained using a downhole pressure tool can be employed to determine formation transmissivity and well properties. Even if it proves difficult to discharge a slim hole, an injection test can be performed to obtain formation transmissivity. Given the discharge (or injection) data from a slimhole, discharge properties of a large-diameter well can be inferred using wellbore modeling. Finally, slim hole data (pressure, temperature, transmissivity, fluid properties) together with reservoir simulation can help predict the ability of the geothermal reservoir to sustain power production.