This study investigated the effects of story structures and study trials on memory and reasoning in mentally retarded and non-retarded children. Eighty-four retarded children from special classes and 200 non-retarded children from regular classees were used in the present experiment. Within each of these two IQ groups, the subjects were further divided according to two types of story structures into two subgroups (one subgroup read a highly structured story, and another read a poorly structured story). Analyses of the data showed that recall and reasoning obtained from the highly structured story were superior to those obtained from the poorly structured story, irrespective of the retarded or non-retarded subjects. The use of easy materials led the retarded subjects to mprove at a faster rate than the non-retarded, although the absolute performance level of the former subjects remained lower than the latter. The pedagogical implications of the study were discussed.