Mixed results from evaluations of school reform suggest a need for evidence to explain why some models succeed while others fail. Addressing that need, this study uses structural equation modeling to estimate difference-in-differences models that examine mediating mechanisms for positive effects produced by Innovation Zone (iZone) reforms in Memphis, Tennessee. I find that iZone schools increased peer collaboration between teachers, which resulted in improved student achievement. Also, recruiting effective teachers led to a more positive learning environment and ultimately to improved student achievement. These results highlight peer collaboration, a positive learning environment, and the recruitment of effective educators as important practices that will likely facilitate improved school performance under future school reform plans.