A study investigated how schools and teachers attempt to meet the needs of language minority students and to utilize literature as a means to teach English language reading to students while building their English language capacities. Language arts and reading instruction was observed in 12 third- through fifth-grade classrooms in three elementary schools in a large urban school district in California. Two schools were primarily Hispanic, and the third had a wide range of immigrant groups. All participating classrooms were observed for 3 to 10 mornings over a period of two school years. Teachers were interviewed, and focus groups were conducted with groups of teachers working with the population. Results of classroom observations indicated that: (1) students faced the dual demands of learning to express ideas in a new language (both oral and written), as well as mastering the normal upper elementary grade curriculum while saving face; (2) teachers faced the multiple, potentially conflicting demands of assisting students with English language acquisition and developing cognitive skills and abilities; and (3) teachers were urged to implement innovative approaches to literacy, such as whole language or literature-based instruction, that are often difficult to implement even with highly motivated monolingual students. Interviews with the teachers revealed: limited belief that the students could independently create meaningful essays or interpretation of novellas; limited faith in their own ability to teach these students; and fairly superficial understanding of whole language and other process approaches. (Contains 37 footnotes.) (RS)