Drawing on our joint experience both inside and outside of national policymaking processes,1 we will use this chapter to explore some of the defining characteristics of the education policy-making environment as it is currently constituted in England, and its impact on the content of literacy policy. In particular, we will look at the interactions between research and policy-making communities as they unfold over time and in relation to the policy cycle, using as our focus the contested area of phonics and its place in the National Literacy Strategy (NLS). We hope to draw out some general principles for understanding what currently shapes the relationship between policy and research, the distinctive qualities of these two very different knowledge communities and the ways in which they then work to create, defend, challenge or modify policy. In doing so we will draw on the distinction Gibbons and colleagues make between Mode 1 and Mode 2 knowledge (Gibbons et al. 1994).