This study examined how teachers in Tanzania understand and implement Phonics Instructional Approach (PIA) in the teaching of reading among early graders. Specifically, the study assessed teachers' pedagogical knowledge of the use of PIA and explored effective PIA practices used by teachers in literacy skills learning. The study employed questionnaires, interviews, and observations in collecting quantitative and qualitative data. The study was conducted in 25 public primary schools in Mbeya Region and involved 83 Early Grade Teachers (EGTs), 180 standards one and two (STD I-II) pupils, and 2 Primary School Quality Assurers (PSQAs). The quantitative data were analysed using Statistical Package for Social Sciences (SPSS) whereas the qualitative data were analysed through thematic analysis. The findings indicated that teachers did not have sufficient training on the 3Rs (Reading, Writing, and Arithmetic) something which was affecting their pedagogical knowledge of PIA in the teaching of early reading. Additionally, the teachers were found to believe in the use of teaching aids, good teacher-student ratio, and the use of synthetic phonics as some of the effective practices for implementing PIA. It is, therefore, recommended that more classrooms be built to have a good teacher-student ratio, and more teachers are trained on the 3 Rs.