Phonics is a method of reading instruction that utilizes the alphabetic principle. This principle claims that there is a predictable relationship between phonemes and graphemes which can help decode words.
Phonemes - the sounds in spoken language
Graphemes - the letters that represent the sounds in written language 
To learn more read the Basics of Phonics intruction. There are many websites devoted to making Phonics instruction more enjoyable for children. The following websites offer games and online activities for your emerging reader:
Between the Lions: Blending Bowl
BBC Kids: Words and Pictures
Learning Planet
Offers games and activities for various age groups including Preschool-Kindergarten, 1st-3rd, and 4th-6th. photo courtesy of flickr user john-morgan
Sight Words is a reading instruction method in which the reader can recognize common words by sight and not by sounding them out.
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Edward Dolch was instrumental in popularizing this method and was responsible for creating the Dolch Word List.
In the 1990s, Edward Fry compiled a list of 600 words that were the most frequently used in reading and writing. You can also view Fry's High Frequency Words online as well.
There are many online resources available for parents to help aid their children in learning sight words. Here are a few links for at home practice and fun!
The School Bell
Dolch Word Search Puzzles
TVO Kids - Melvin's Marvellous Words 
Language Immersion may also be referred to as the Language Experience Approach or Whole Language Approach to reading instruction.It is a philosophy of teaching and learning that has literacy at its core. This idea seeks to intergrate reading, writing, and speaking into all aspects of learning.
Reading aloud, writing projects, storytelling, critical thinking and discussion are all components of this methodology.
If you are curious about the history of the Language Immersion Philosophy, visit http://www.immersionliteracy.com.There is also a section that compares the similarities and differences between a typical classroom setting and an immersion literacy classroom.
To access activities, lesson plans, and information that focuses on Language Immersion, visit Literacy Matters.
There are also additional websites that can help you engage your child in a variety of literacy-focused activities:
Bank Street: Developing a Language Experience Story
Library of Congress: Primary Source Sets
The Story of Movies: Lesson plans for incorporating visual literacy into cross-curricular studies.
Education World: Discussion Webs in the Classroom
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Content Literacy focuses on reading to learn, not just learning to read
Non-fiction texts and reading materials such as newspapers, magazines, letters, and websites are utilized in this reading instruction method. The content literacy approach brings literacy into other subject areas such as science, math, and social studies to allow children an opportunity to focus on their own particular areas of interest.
To learn more about Content Literacy visit the Content Literacy Information Consortium.
Some resources for strategies and activities include:
Literacy Matters
An excellent website for fully understanding the theory of Content Literacy. The site contains lesson plans and additional resources for educators, parents, and students.
Story Maps
Teach kids how to map out and analyze components of a narrative.