The increasing numbers of English language learners (ELLs) in Canadian schools pose a significant challenge to the standards-based provincial tests used to measure proficiency levels of all students from various linguistic and cultural backgrounds. This study investigated the extent to which reading item bundles or items on the Ontario Secondary School Literacy Test (OSSLT) function differentially for Grade 10 students who speak only or mostly English at home (first language [L1] students; n = 1,969) and those whose home language is something other than English (ELL students; n = 3,675). Based on Rousso's and Stout's (1996a) multidimensionality-based DIF analysis paradigm, a variety of substantive and statistical techniques were employed: (a) content review by English as a second language (ESL) experts, (b) exploratory and confirmatory dimensionality analyses, and (c) confirmatory differential bundle functioning (DBF)/differential item functioning (DIF) procedures. The evidence gathered in the study indicated that items associated with vocabulary knowledge favored L1 students, whereas items requiring grammatical knowledge or integrated reading and writing skill favored ELL students. Instructional implications for the promotion of effective literacy education programs are discussed, as is the development of a literacy curriculum that can meet the needs of linguistically diverse learners in a multilingual context.