Literary texts do not usually reflect English as a means of communication. The failure to read literary texts becomes the central concern in the study of language learning and teaching. Literary texts may lead adult readers to an ambiguous understanding due to having multiple interpretations. The current study aims at finding out the effect of the dialogic reading technique within teaching method on Iraqi EFL university learners according to the dimensions of literacy skills: operational, cultural, and critical and according to tasks of story comprehension: knowledge graph construction, fact-retrieval, and prompt formulation. A pretest-posttest design with control group of quasi-experimental study method to fulfill the objectives of this study. The sample involves 120 undergraduate students at the College of Education for Women/ University of Baghdad. The overall study experiment lasts for fourteen weeks during the academic year 2024-2025. Achievement posttest is used as an instrument for measuring the performance of Iraqi EFL university learners. The results confirm statistical rejection to differences between the mean scores of the experimental group in the dimensions of literacy skills. The study concludes that the dialogic reading technique effects Iraqi EFL university learners' cultural dimension of literacy skills and fact-retrieval task of story comprehension. The study suggests that selection of text materials of different stances could improve learners' awareness and writing performance skills.