For the purpose of examining the relationship between preschool children's level of literacy development and the contextualization of story content to the children's world knowledge, a study was conducted investigating how parents of high and low print aware children contextualize stories for them in terms of their prior knowledge. The study involved 27 children, ranging in age from 4 years 7 months to 5 years 9 months, and 40 parents. Thirteen children were identified as High Print Aware and 14 as Low Print Aware. A familiar or favorite story and an unfamiliar story were read by each participating adult to his or her child. Tape recordings of the readings were transcribed and analyzed descriptively to determine instances of contextualization. Results indicated that High Print Aware children and their parents contextualized textual information within their own background experiences more frequently than did parents of Low Print Aware children and the Low Print Aware children themselves. With familiar texts, parents of High Print Aware children contextualized information an average of four times per story; with unfamiliar stories, the average dropped to two times per story. Parents of Low Print Aware children contextualized information on an average of once per story, regardless of familiarity. The findings suggest that with High Print Aware children, contextualization may serve a social function rather than work as a means of establishing meaning. However, they appear to have an advantage over their Low Print Aware counterparts, as the latter have less opportunity to broaden their knowledge by linking story information to their own understanding of the world. (Author/JC)