Recent developments in language teacher cognition research highlight the need to explore subject matter knowledge in relation to classroom practice. This study examines the impact of two foreign language teachers' knowledge about grammar upon their pedagogical decisions. The primary database consisted of classroom observations and post-lesson stimulated recall interviews in which the teachers explained the rationale for their use of particular grammar teaching actions. The findings show that teachers' decisions are influenced by a multiplicity of factors which are internal and external to them, one of which is their self-perception of their knowledge about grammar. This self-perception has been found to be grounded in a range of aspects and to influence diverse facets of grammar teaching. The results expand on our current understanding of knowledge about grammar and its impact on grammar teaching, and have strong implications for language teacher education and development.