The evolution and activities of the National Languages and Literacy Institute of Australia Limited during its first three years are described. The institute consists of a complex network of activities across Australia, including; a research and policy coordination center in Canberra; nine research and development centers specializing in various aspects of applied linguistics (language testing, language curriculum, sociolinguistics, language and technology, language acquisition, deafness and communication studies, literacy and culture, dictionary research); two research networks, one on adult literacy research and one on child English-as-a-Second-Language and literacy; a Victoria branch office; an office in Western Australia combining child and adult literacy research work, a teachers' professional development center, and a research and development center; a teaching a curriculum center in Adelaide; a business language services program in South Australia; a document design and research unit; formal collaborative arrangements with a university English language teaching and research center; and a university center for research and development on interpreting and translation. The report details the activities of each of these components, including major publications. (MSE)