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The purpose of the present study was to develop a CAI system for improving Japanese learners' English listening skills and to measure the system's efficiency. A specific feature of the system is the mixture of graded tasks and the learning resources that the students go through while they are being presented with various types of naturally spoken discourse. Ten independent subject groups totaling 88 learners participated in the experimental use of the system for approximately nine hours per person. The average dictation score of naturally spoken utterances improved 10 per cent and the average comprehension score of news and drama improved by 29 per cent, while the improvement in the comprehension of slightly easier dialogues such as at airports and hotels was 38 per cent. The amount of improvement observed in this study was approximately three times as large as that obtained by other instructional methods conducted in Japan. In a learners' self-evaluation questionnaire, the subjects expressed the strong desire to make further use of the system. In comparison with previously used materials, they reported that the sytem in the experiment was by far the best of the teaching methods they had used thus far.