In the paper steps of Literacy Assessment Battery (LAB) construction were described. The battery is based on the theory of Lev S. Vygotsky. Following his theses literacy acquisition is a process of development of higher order mental function named written speech. This process begins long before a start of reading and writing instruction. Results of research on main problems with design of LAB were also presented. Five different studies were done: 1) a pilot study on 16 children aged from 3 to 10 years; 2) a study on 400 children aged from 3 to 11 years; 3) assessment of LAB by 7 competent referees; 4) pilot study on 40 children aged from 3 to 7 years; 5) main study on 1103 children aged from 3 to 11 years. Usefulness of LAB in differentiating levels of written speech development in children among 3 and 11 years of age was confirmed.