This handbook provides suggestions for gathering and interpreting information about students' reading behavior; planning instruction that develops students' reading skills; and planning instruction that reinforces and extends students' reading skills in areas where they are successful. After a brief introductory section, the handbook presents a diagnostic teaching guide that includes the core materials for achieving these goals by describing everyday classroom activities (grades 1-6) to observe students' reading behaviors, and suggesting possible related instructional activities. The handbook then presents a diagnostic tools section that includes checklists, observation guides, and a reading profile. Appendixes providing samples of students' work, a guide for selecting books, the Language Learning Framework, blackline masters of charts and checklists, and an outline of the relationships between the 1986 Diagnostic Reading Program Evaluation Strategies and the language learning concept area are attached. (RS)