This guide for Adult Basic Education (ABE) teachers in reading instruction was developed at a Mankato State College workshop. It is divided into three sections: (1) the placement of students in reading materials and instructional programs, (2) the diagnosis of basic word recognition skills (sight words, phonics, and structural analysis), and comprehension skills. As a supplement to the document are three appendixes on placement materials, tests and forms for diagnosis and evaluation, and materials and techniques for instruction. (BP)