This is an inductive case study of a European-American fourth-grade girl who struggled with print-based aspects of literacy. The study highlights her multiple levels of competency as she participated over time in a heterogeneous literature discussion group that read and responded to three culturally diverse novels. Data include 27 audio-taped literature discussions, observational field notes, audio-taped interviews and presentations, and written artifacts. Grounded in social constructivist theory, this research documents one reader's non-linear movement from a literacy club outsider to shifting positions as a less-capable member in need of support, a capable peer operating solidly within her zone of proximal development, and a more capable peer working at her actual development level. She supported others' understandings by challenging group members to understand characters' situations, voicing non-stereotypic or antiracist thinking, and connecting self and others to the emotional power of prose. Questioning deficit models of reading and static labels for achievement, this study provides evidence of the contextual nature of displays of literacy competence. Implications focus on the conditions of the learning environment that supported an inclusion model of literature-based reading pedagogy.