A study examined systematically the relationship of 40 teacher characteristics and the reading improvement of adult basic education (ABE) and adult secondary education (ASE) students. Subjects were 50 adult basic and secondary education teachers and 663 of their students from a dozen adult literacy programs in a Southern state. A multiple regression technique was employed to generate an equation to predict student reading gains on the basis of teacher characteristics. Results indicated that only 4 of the 40 examined teacher characteristics warranted inclusion in the final predictive equation: number of years a teacher had been working with adults in the same location; number of years since completion of the last college degree; teacher perception of percentage of reading gain attributable to his/her instructional and motivational efforts; and number of years since a teacher had completed a college-level reading instruction course. Results also indicated that only one of 14 student characteristics was related to reading improvement: pre-instructional Test of Adult Basic Education score. Recommendations include that, when student reading progress, the preeminent learning outcome, and other characteristics of prospective and incumbent teachers are equal, employment and retention decisions concerning ABE and ASE teaching positions should be based in the four teacher characteristics identified. (Contains 36 references and 7 tables of data). (RS)