A fine motor test involves the manipulation of smaller objects with fingers, hands, and wrists. This test is an integral part of the evaluation of an upper extremity function. Nine Hole Peg Test (NHPT) is one among such tests which assess the ability to manipulate pegs with the thumb and finger. There is a need to develop a fine motor assessment tool which is reproducible and mimics closely the natural movement of hands. The aim of this work is to develop an electronic pegboard which is easy to administer and efficient in terms of time. Pegboard device is modified and standardized by (1) Adding electronic circuits to custom-made pegboard and programmed using a microcontroller (ATmega2560), (2) Following a specific sequence in placing and picking the pegs from the board, and (3) Using Infrared sensor and robust algorithm to ensure one peg movement at a time. The setup is administered on 15 healthy participants (nine females, six males aged between 21 and 80) and the outcome is compared with the results of traditional NHPT. Predefined sequence in moving the pegs and electronic timer features provide reliable results for repeated measurements and facilitate storing test score in a digital repository. This data could be used as reference data during the follow-up visits. The maximum difference between the measured timing between the present setup and traditional NHPT is about 6.7%. It is important to note that, due to inherent delay (response time) in the traditional NHPT, when compared to present setup the measured timing is always on the higher side. Nondependency on the manual stopwatch to record the time and hands-free of any wearable device are the advantages of the present setup.