This study investigated which level of graded reader was most appropriate for Chinese-speaking learners of various English abilities and whether there were significant differences in comprehension and vocabulary acquisition when different English proficiency (EP) groups read texts of varying difficulty levels. Eight-two senior high school students in Taiwan were divided into low, medium and high EP groups (LEP, MEP, and HEP). They read graded readers at Level 2, Level 3, and Level 4 after class and completed comprehension and vocabulary tests, and a text difficulty questionnaire. The results show, first, that the most suitable graded readers for LEP, MEP, and HEP groups were found. Second, there were significant differences among the three EP groups in the comprehension and vocabulary test scores of these readers. Third, there was a significant correlation between text comprehension and vocabulary acquisition when each group read the text appropriate for its level of linguistic competency. Armed with the results, instructional recommendations are presented.