Purpose: This research was carried out to create a new realistic speech-in-noise test designed to be sensitive to several causes of difficulty understanding speech in noise. The test, conducted under headphones, simulates listening in a typically reverberant classroom. It comprises a frontal target talker speaking high-context sentences and six competing talkers at different apparent locations. Method: The first experiment initially measured the degree of context in the sentences by presenting them in writing, with one or two words missing, to adult participants who were asked to guess the missing word(s). The 48 highest context sentences were then presented to young adults through headphones, with the competing speech, to measure the relative intelligibility of every morpheme in each sentence. The levels of each morpheme were then adjusted to minimize intelligibility differences between morphemes. In the second and main experiment, the final version of the test was presented to 103 adults and 77 children (aged 6–12 years) to create normative data for an Australian-accented version of the test. Results: In children, mean speech reception threshold in noise (SRTn) improved at a rate of 0.5 dB per year, down to −12.1 dB at 12 years of age. The regression line suggests that performance reaches that of young adults (with SRTn = −13.3 dB) at 14 years of age. Conclusions: The Test of Listening Difficulties–Universal (ToLD-U) appears to be suitable for assessing speech understanding in both children and adults under realistic, challenging listening conditions. It is the first test designed to simultaneously realistically simulate real-world environments using sentence-level but morpheme intelligibility–equalized test stimuli recorded using a conversational style, with multiple competing talkers and reverberation; nonetheless, it was designed to be suitable for routine clinical use via headphone presentation. Studies evaluating the ToLD-U in a clinical setting are in progress. Supplemental Material: https://doi.org/10.23641/asha.30493694