From the theoretical framework of cognitive anthropology based on the work of Charles Frake, this study explored children’s classification systems underlying their interactions with illustrated picture storybooks in a classroom context. As a classroom participant-observer, the researcher carried out a classification task where children in a culturally diverse first-grade classroom sorted 15 picture books into piles of books having similar characteristics. It was found that the children classified books by topic, genre, author, culture, emotional response, and physical property of the book. The children’s responses were placed in the context of the classroom setting. Some aspects of the children’s classification systems were found to be similar to the teacher’s way of categorizing books in the classroom library and also her way of classifying books in a book sorting activity.