Much research on reading and writing in schools continues to focus on individual cognitive skills. In contrast, investigations of literacy-learning in out-of-school settings have often taken a socio-cultural perspective, situating reading and writing in social relations and cultural institutions. The last 20 years have seen a proliferation of studies documenting the ways in which printed texts are taken up in a wide variety of settings from after-school clubs and community-based adult literacy programmes to workplaces, the Internet, and "everyday life". Increasingly, there have been calls for sociocultural literacy researchers to begin directing their attention to mainstream educational contexts. In this paper, we join in and seek to contribute to such calls by drawing out some of the complexities and caveats that also need to be kept in mind. After briefly reviewing what it means to define literacy and learning in relation to socio-cultural context, we explore some recent arguments for conceptual and methodological refinements. We then turn our attention to schools and to what a socio-cultural definition of literacy has to offer in terms of addressing diversity and educational inequity, and we draw out several issues that require closer consideration.