Background/Context: Institutional theories sometimes characterize the normative influence of institutions as diffusing like waves and as exerting uniform pressures on individuals. This article contributes to a growing literature on the microfoundations of institutions, investigating how intraorganizational networks mediate the diffusion of institutions on teachers' instructional practices. Purpose/Objective/Research Question/Focus of Study: This study focused on the normative influence of reading policy on teaching practice in the early 2000s. We chose to focus on reading during this period, which was marked by an unusual level of policy coherence. Federal and state agencies, as well as school districts, implemented a number of policies and programs to encourage teachers to follow the National Reading Panel's (2000) recommendations to emphasize basic skills development in reading instructional practices. Setting: The research took place in 11 elementary schools. An important note is that the pressure teachers experienced in these schools to adopt the practices recommended by the National Reading Panel was indirect. The schools in the study did include three Title I schools, but no schools in programs that required them to adopt these practices. All schools used state-adopted curricula in reading that were aligned with recommended practices. Population/Participants/Subjects: All faculty members in the 11 schools were part of the study from 2004 to 2008. The sample in the final analysis (n = 136) included teachers with direct responsibilities for teaching reading in a single school over these 4 years. This figure represents 84.47% of our original sample (N = 161). Research Design: This study is a longitudinal observational study that includes social network data and multilevel analysis. We surveyed faculty four times in waves conducted in 2004, 2005, 2007, and 2008. Data Collection and Analysis: The primary source of data was a survey that asked teachers to identify their close colleagues and colleagues who provided them with help on reading instruction (including measures of frequency of interaction). The dependent measure in our analyses was based teachers' responses to items about instructional practices in reading, especially skills-based instructional practices. We fit multilevel models to estimate the extent to which reading practices were a function of teachers' interactions with colleagues and their membership in subgroups, which were identified from the indicators of closest colleagues using Frank's algorithm. Findings/Results: Teachers' practices did not conform exclusively to the new normative regime but rather depended on exposure to external professional development in reading instruction and on local norms of practice in their schools and collegial subgroups. Over time, moreover, subgroups' practices diverged with respect to teachers' implementation of skillsbased reading instructional practices. Conclusions/Recommendations: Our study findings provide strong evidence that local social dynamics such as the ones we illuminate here are key in shaping the implementation trajectory of any instructional practice or reform. Policies may set the stage for adopting particular practices and direct resources toward certain kinds of supports through curriculum and professional development programs they incentivize. However, teachers' interactions with colleagues mediate the response to these directions and incentives in ways that can produce outcomes that diverge widely from policy makers' intentions.