This thesis looks at the mental stores created in reading real, full, narratives. It concentrates on how we utilise these stores when interpreting pronouns and other reference items. Initially we work within a traditional anaphoric framework, seeing how far this can account for how a reader establishes a link between pronoun and antecedent in real text. Character constructs, equivalent to Brown and Yule's mental representations, are later built into the model and the role of the antecedent is reconsidered. It is then argued that to understand reference in narrative we need to consider how narrative is structured. This leads us to postulate the frame, a contextual construct which monitors which characters are together in which place at what time. Contextual information is rarely specified fully in any one sentence but an awareness of it is essential for an understanding of the action. We consider how we may modify frames, switch from one frame to another and reactivate earlier frames. The frame is first used to explain examples where there is no antecedent in the near environment of a pronoun. It is then built into a model of reference which is anticipatory rather than anaphoric. The frame also leads us to consider the nature of character constructs and to postulate narrative enactors. Finally we draw a distinction between framed text and unframed text, arguing that this distinction is necessary to understand how a reader interprets reference items in real narrative examples.