Formative assessment with feedback is part of the assessment program in medical education to improve students' learning. Limited research has focused on its application and impact on practical anatomy education. This study aimed to examine medical students' perceptions of formative assessment in practical anatomy sessions of body systems-based educational units and explore its influence on final practical exam performance. A descriptive, cross-sectional study was conducted. Data was collected from 173 Year 2 medical students through a survey that addressed their perception of process and importance of formative assessment and feedback. The survey employed a 5-point Likert scale. Two open-ended questions were appended at the end of the survey. Students' performance in Unit 3 (where formative assessment was conducted) was compared to their performance in Unit 2 (where no formative assessment was conducted) and with the performance of the previous academic year's students in Unit 3 (where no formative assessment was conducted). Descriptive statistics were used. The level of statistical significance was set at p-value < 0.05. Responses to open-ended questions (qualitative data) were counted, categorized as themes, and presented as frequencies and percentages. The survey showed high internal consistency, and its validity was established through exploratory factor analysis. Results showed that the mean mark for the unit with formative assessment and feedback was significantly higher than for the units without formative assessment and feedback. Students showed positive perception of formative assessment and feedback conducted after practical anatomy sessions. They reported useful insights regarding the benefits they gained from formative assessment and feedback as well as constructive suggestions for future improvements. The study indicates that students positively perceived formative assessment and feedback sessions after practical anatomy sessions. Findings also refer to a positive effect of formative assessment on students' performance in summative practical assessment in anatomy.