The aims of this action research are: (a) to investigate the process of differentiation of teaching and learning in mixed ability classes from the perspective of teachers', and (b) to examine the effectiveness of differentiation of teaching and learning in improving reading abilities of students from the first class of the lyceum (fifteen year olds), their self-efficacy and their attitudes towards learning. This action research uses the results of pre and post tests, students' interviews before and after the intervention, class observations and teachers' diary records. The research indicates that the main obstacles teachers have to face are: (a) to define, analyze, and hierarchize reading abilities and strategies from the simplest to the most complex (b) to clarify students' readiness (c) to design lessons to address students' readiness, interests and learning style (d) flexible class organization, and mainly (e) to get rid of misconceptions about their role in the learning procedure. In addition, the research reveals the contribution of differentiation in students' learning, self-efficacy, and beliefs about learning. The most important conclusions are that teachers' self-reflection and cooperation with other colleagues play a major role in teachers' conceptual change and in enhancing teachers' efforts to deconstruct the curriculum according to their students' needs. Finally, respecting students' individuality leads to the improvement of their knowledge and skills and motivates them to learn.