The article describes a collaborative action research in a preschool in Reykjavik. The participants were two preschool teachers who collaborated with researchers at the University of Iceland. The project was set up as a professional development course for the teachers. Emphasis was placed on continuity in children's education, integration of play and learning, and the connection between play and emerging literacy. Data were gathered using video recordings, photos, interviews, observations, notes from meetings, documents, and diaries. The findings indicate that participation in this action research empowered the preschool teachers and influenced their practices and ideas. They became more aware of the value of play in children's learning. They did not, however, change their former practices in which they worked on literacy during specific, well-defined periods: their beliefs and practices in this regard seemed to be constrained by traditions in which play and learning are separate entities.