This paper presents the initial efforts in the development of the Prediction with Diagnostic Qualities (PDQ) instrument. The contents include: "Evidence Relating to Correlational Items," which discusses the concepts of correlation, statistical significance, and the more commonly used criteria or tests used for prediction and diagnosis--chronological age, mental age IQ, socioeconomic status, neurological deficits, emotional problems, reading readiness tests, teacher judgment, visual-motor integration, and knowledge of letter names; "What Is Necessary for Success in Reading," which looks at what children need for success in reading and how to diagnose for those needs; "PDQ Procedures," which discusses the PDQ battery and lists the tests included such as auditory discrimination, listening comprehension, vocabulary, categorization, picture sequence, oral language development, following oral directions, and using oral context; "Preliminary Results of PDQ," which presents the results and findings of the use of PDQ in a kindergarten program; "Implications for Instruction," which presents examples of the kinds of kindergarten activities appropriate for children who need additional work in a given area; and "Summary." (WR)