We examined the bidirectional relations between home literacy environment, reading interest, and children's emergent literacy and reading skills in a sample of 172 English-speaking Canadian children (M[subscript age] = 75.87 months) followed from Grade 1 to Grade 3. Results of cross-lagged analysis revealed that the reading comprehension activities (RCA) at home positively predicted children's reading skills at the end of Grade 2 and the reading skills negatively predicted the RCA in Grade 3. Parent-rated reading interest was bidirectionally related to reading skills, whereas child-rated reading interest was only predicted by earlier reading skills, but not vice versa. These findings suggest that parents are sensitive to their children's reading performance and modify their involvement accordingly.