The Viburnum Foundation, a family foundation based in New York, is currently in the fifth year of giving grants to rural library-sponsored family literacy programs in Louisiana, Mississippi, New Mexico, Oklahoma, and Texas. The libraries involved in the Viburnum Family Literacy Project are in areas with high levels of poverty and illiteracy. The programming, which usually takes place at a library, a Head Start Center, or a school, may include parenting classes for adults, adult literacy and English as a Second Language instruction in classrooms and by tutors, storytelling and reading aloud to children exclusively or for all generations, and bilingual programming for adults and children. This report discusses what makes library-based family literacy programs work, and how policymakers, grantmakers, and community leaders can collaborate to promote family literacy in rural areas. Following an introduction, the body of the report is divided into six main sections in terms of the following topics and subtopics: 1) the rural library as a site for family learning and the rural community as a site for social change; 2) program staff and participants; 3) partnerships; 4) programs (planning, budgeting and spending, program design, content and activities, impacts); 5) grantmaking issues; and 6) critical areas of change. A concluding chapter reiterates the reasons why libraries and literacy programs are critical to the health of society, and outlines difficult challenges to be faced in the near future. Appendices present a Viburnum Foundation project history and list of Viburnum sites. (AEF)