Many children who speak English as an additional language (EAL) underachieve in areas of English literacy, especially in the primary years. These difficulties are often attributed to low levels of English language fluency as they enter the education system. In an effort to provide a greater understanding of this underachievement, the cognitive-linguistic factors underlying literacy development in monolingual children and children learning EAL were examined in a three-year longitudinal project. The project, conducted in schools in the north of England, followed the developmental progression of forty-three children learning EAL and forty-three monolingual children from school years Two to Four. Children were assessed on measures of reading accuracy, reading and listening comprehension, receptive and expressive vocabulary, and reception of grammar. Analysis revealed similarities between the two groups of children on reading accuracy, but children learning EAL had lower levels of vocabulary and comprehension at each point in time. Data are discussed in terms of the development of underlying language skills and the impact of these skills on both reading and listening comprehension. The implications of the findings for classroom practice are considered.