Motion analysis using inertial measurement units (IMU) has emerged as an alternative to optical motion capture. However, the validity and reliability of upper limb measurements varies significantly between studies. The objective of this study was to determine how sensor placement affects kinematic output in the assessment of motion of the arm, shoulder, and scapula. IMUs were placed proximally/distally on arms, and medially/laterally on the scapula, in a group of eleven healthy participants, while performing nine different motion tasks. Linear regressions and mixed models analysed how these different sensor placements affected the estimated joint motion by establishing the linear relationship between sensors placed on the same body segment. The placement of sensors affected the measured kinematic output considerably, most prominent affect was seen for sensor placement on scapula during flexion and abduction, and on forearm during pronation/supination. The slope of the linear regression lines was 2.5 during flexion, 2.7 during abduction, and 1.8 for forearm pronation/supination. The results of this study suggest that the forearm sensor should be placed on the dorsal side of the forearm, at the distal end; the upper arm sensor should be placed laterally, on the distal part of the arm; and the sensor on the scapula should be placed cranially, along the spine of scapula.