An ethnographic study of kindergarten through grade two classrooms was conducted of various sociolinguistic contexts in which young students were developing oral and written language competencies. Nonparticipant observations were conducted in both regular classrooms and Chapter I small group classroom settings. The observations were analyzed from a variety of perspectives spanning a range from whole language to a more conventional language arts approach to instruction. A coding system was developed to assist in the analysis of protocol data regarding literacy events, oral language interaction, and evaluation occurring in classroom settings. The data indicated that for the most part literacy lessons must have functional meaning for the child if positive learning is to occur. (An overview of the major aspects of a whole language approach to instruction, the responses of low-achieving students to whole language activities and recommendations for improving the literacy learning of young students are included, as are definitions and discussion of selected codes for analysis of protocol data.) (Author/HOD)