Research on children's early literacy learning has predominantly focused on a 'child attribute improvement methodology' (Bloome & Katz, 2003) in which the child is conceptualised as having a series of attributes which are potentially affected by particular sets of treatments or events. These 'input-output' studies, also described as 'black box' studies, set up one kind of literacy pedagogy against another, where early literacy is seen as a neutral, cognitive, perceptual and individualised activity or set of skills to be acquired centred on sound-symbol relationships. The theoretical orientation in this article draws on work in emergent literacy (Clay, 1972; Ferreiro & Teberosky, 1982; Goodman, 1986), new literacy studies and social semiotics( Heath, 1983; Street, 1984; Dyson, 1993; Barton, 1994; Gee, 1996; Prinsloo & Breier, 1996; Kress, 1997) to analyse the ways in which reading and writing and other communicative modalities are taught and learnt as forms of socially situated activities, with boundaries, prohibitions and procedures set by different theories of reading and different sets of institutional practices. Through an exploration of data collected in early literacy classrooms in the Western Cape and Gauteng as part of the ethnographically based Children's Early Literacy Learning (CELL) project, the writers examine the nature of young children's early encounters with literacy and the implications of these encounters for their later development as readers and writers in schools.