The development of reading and language awareness was investigated by measuring beginning letter and word knowledge in five- and six-year-old children of average ability. A letter and word reading test was constructed on the basis of a hierarchical representation of linguistic awareness of preschool children; 50 children's performance on this test was then measured at the end of kindergarten and at the beginning of first grade. A standardized measure of reading achievement at the end of first grade served to evaluate the usefulness of the test. The results indicated that the letter and word reading test was reliable and highly predictive of beginning reading achievement. Performance on the test was shown to follow the development of linguistic awareness and documented change in beginning reading competence. (Author)