Background: Studies have suggested genetic and environmental influences on overall level of early reading whereas the larger reading literature has shown environmental influences on the rate of growth of early reading skills. This study is the first to examine the genetic and environmental influences on both initial level of performance and rate of subsequent growth in early reading. Methods: Participants were drawn from the Western Reserve Reading Project, a study of 314 twin pairs based in Ohio. Twins were assessed via three annual home visits during early elementary school. Assessments included word identification, letter identification, pseudoword decoding, expressive vocabulary, phoneme awareness, and rapid naming. Measures were analyzed using latent growth curve modeling. Results: The heritability of initial performance (latent intercept) ranged from h[superscript 2] = 0.38 or word identification to h[superscript 2 = 0.72 for rapid naming. Shared environment ranged from c[superscript 2] = 0.11 for rapid naming to c[superscript 2] = 0.62 for word identification. The heritability of the rate of subsequent growth (latent slope) was statistically significant for rapid naming h[superscript 2] = 0.58 and phoneme awareness h[superscript 2] = 0.20. Shared environment accounted for nearly 100% of variance in rate of growth for word identification, letter identification and pseudoword decoding, and was statistically significant and large for phoneme awareness (c[superscript 2] = 0.80). Genetic variance for rapid naming and phoneme awareness latent slopes overlapped entirely with genetic variance on the intercepts. In contrast, one-third to two-thirds of the shared environmental variance on the slope was independent from the shared environmental variance on the intercept. Conclusions: Genetic influences were related primarily to those already present at the initial level of performance. In contrast, shared environmental influences affecting rate of growth were both predicted by and independent from initial levels of performance. Results suggested that growth in early reading skills is amenable to family, school, or other environmental influences as reading skills develop.