The purpose of this study is to investigate the effect of the teacher- child interaction for story reading on the child`s understanding. This is based on the theory of social interaction of Vygotsky that argues that a child can solve a difficult problem independently through the guidance and the help of an adult. Thus the pupose of this thesis is, in other words, to demonstrate that the child`s various experience with the adult promotes the child`s cognitive development as well as to emphasize the importance of strategies appropriate for the child`s developmental stage. In order to attain this goal, the following hypotheses were established. 1. There will be a difference in children`s understanding between the group where a teacher just reads the story for a child and the group where a teacher reads for a child and interacts with a child through questioning and summarzing. 2. The effect of the teacher-children interaction in reading will vary according to the familarity(familiar/unfamiliar) of the given story. To verify these hypotheses, eighty 6-year old children randomly sampled from eight classes were divided into a forty-member experimental group and a forty-member control group. 20 of the former group were for the reading of familiar stories and 20 for that of unfamiliar stories according to the familiarity of the stories. To verify the teacher-child interaction in reading, comprehension checkup papers(2(groups) X 2(familiarity)) graded were analysed by Anova. The result of this study can be summarized as the following. 1. There was a significant difference between the experimental group which read with the teacher-child interaction and the control group which just read without any interaction. 2. The effect of the teacher-child interaction in reading significantly varied according to the familiarity of the stories. In other words, the effect of the interaction was greater in familiar stories and the child`s understanding ability was much greater.