Traditional reading placement tests, determining the level at which students can read without teacher mediation, frequently lead to student underplacement. Diagnostic teaching practices, however, can be used to determine students' emergent reading level, the reading level that can be achieved through instruction. After preteaching part of a lesson--providing motivation, background, vocabulary assistance, and purpose--the teacher has students read first silently and then orally. During the oral reading, the teacher records the number and kinds of reading miscues made and notes student affect. By leading students through progressively more difficult lessons, the teacher can determine (1) at what levels the pupils can read comfortably without help, (2) when reading becomes so difficult that the experience is more harmful than helpful, and (3) what range of materials the pupils can handle effectively in a teacher-guided situation. Diagnostic testing, reflecting the original intent of diagnostic teaching, gives students the assistance and motivation needed to master increasingly complex conceptual structures. (MM)