By using the concept of on-line goal adaptation, we develop a new paradigm of performance shaping in MRAC. The general idea is to replace the single reference model generated trajectory in classical adaptive design with a tube reference model. Two alternative adaptive control schemes that lead to tractable design formulations are developed in which the performance is adapted on-line to satisfy a new specification in addition to maintaining the usual stability and robustness properties. For this purpose an additional optimization problem is formulated within the MRAC framework to find a correction control term at each instant of time. The proposed approach provides a convenient intuitive interpretation of the design problem, while retaining the fundamental ideas on which model reference adaptive control is based. The system performance is found to be as desired by simulation. (C) 2013 Elsevier Ltd. All rights reserved.