PREVIOUS RESEARCH has examined either the effects of strategy instruction or the effects of literature-based instruction on children's literacy]earning. Much less is known, however, about the combination of teacher-led strategy instruction within a :literature-based framework, The purpose of this qualitative case study was to explore what diverse second-grade students learned about reading, writing, and literature through a yearlong program of strategy instruction integrated within a rich, literature-based environment. Data sources collected by the first author, who was the full-time teacher for the entire school year, and the second author, who was a participant observer in the classroom, included personal journals kept by both investigators, individual student interviews and interviews with parents and care givers, videotapes of regular classroom literacy activities, artifacts of students' reading and writing, assessments of students literacy learning, and the first author's daily plan book. A content analysis revealed that students grew in overall instructional reading level and came to view reading as a natural component of the school day; demonstrated high levels of engagement with books; developed skill in word identification, fluency, and comprehension; and grew in written composition abilities. The authors interpreted these findings within a framework of teachers striving for balance and equilibrium within the curricular elements of literature envisionment and contextualized strategy instruction and a blend of teacher-initiated instruction and instruction responsive to students.