IEEE 1500 standard provides the facility to test and debug embedded cores with the use of an on-board or off-board tester. So far all the developments in IEEE 1500 standard are for testing application in the test mode. No development in IEEE 1500 standard is proposed where IEEE 1500-compliant cores can be tested in functional mode of operation. In this paper, an enhancement of the IEEE 1500 standard for functional test and debug is proposed. As a case study, the proposed enhanced IEEE 1500 standard is implemented and validated on a SAYEH processor using embedded Software Based Self-Testing (SBST) technique. The case study demonstrated that the enhancement in IEEE 1500 standard enables it to be used for at-speed test and debug with increased observability. © 2014 IEEE.