Based on the results of a qualitative study that examined the role of talk during literacy events in a preschool classroom, this article describes ongoing talk among 4-year old children during three reading activities: reading informational text; narrating a story; and browsing over photos. The reading activities in which preschool children were engaged in talk were examined using Halliday's (1978) model of the context of a situation. The article confirms that talk and meanings expressed are affected by what is taking place (field), who is talking (tenor) and what part language is playing (mode). This research reveals the potential of child-to-child conversations; at the same time, revealing spaces or gaps in children's literacy understanding that can be addressed by peer and adult support. The results provide justification for further investigation of the potential of talk in determining children's emerging understanding of reading. (Contains 2 figures.)