A longitudinal study examined the factors that facilitate or hinder Native American children's literacy acquisition. Subjects, 18 three-year-old children attending Headstart classes on the Lummi Reservation in northwest Washington, were observed during their daily hour of free play for an entire school year. The subjects' experiences with drawing, writing, books, stories, and songs were observed. Storybooks were read to groups and individuals, and the subjects were observed drawing pictures and "pretend-writing" their names on their pictures. Although the primary goal of the observer was to become accepted by the children and the teachers, enough data were gathered to suggest certain conclusions and implications for instruction. The data indicated that the subjects: (1) were not aware of print (other than their names) in their classroom environment; (2) were at the scribble stage of drawing and writing; and (3) were familiar with books, knew how to handle them, and knew that books have stories to listen to. Findings suggest that three-year-olds will learn about print by being exposed to labels and signs that reflect the home, school, and community environment; that they will learn about books and stories by listening to the teacher read books and by talking about the stories; and that they will learn about writing by being given the opportunity to experiment with drawing and writing by seeing the teacher write. (Thirty-six references and three appendixes containing forms and tasks, publishers of "big books," and a teaching outline of "the shared book experience" are attached.) (RS)