In Australia, teacher education institutions continue to be increasingly concerned about redesigning their programs in order to better prepare teachers for a culturally, politically, technologically and linguistically changing world (Love, 2009). Because of this, there has been debate about whether due to these changes, teacher education programs produce sufficiently literate teachers (Devereux & Wilson, 2008; Zipin & Brennan, 2006). There appears to be the need, therefore, to further explore the issues relating to the knowledge and beliefs about literacy of pre-service teachers in order to inform effective literacy teaching in the classroom. There is the corollary need to better understand the impact of teacher education programs on the formation and transformation of their knowledge and beliefs because their learning experiences are influenced by their prior viewpoints and attitudes (Shaw, Barry & Mahlios, 2008; Theriot & Tice, 2009). Finally, it is important to investigate early stage development of pre-service teachers’ beliefs about literacy to ensure effective teaching practices in the future (Ogan-Bekiroglu & Akkoc, 2009). The focus of this study is to explore secondary pre-service teachers’ discursively constructed knowledge and beliefs about literacy, including their conceptions about the responsibility of the subject to be taught and their teaching practices and nature of learning. The study also identifies the impact of the literacy course in a university teacher education program on their current knowledge and beliefs about literacy. Case study method was employed in this research, allowing for interviews to be carried out with each of six secondary pre-service teachers who completed a literacy course in a one year Graduate Diploma of Learning and Teaching program. Data were analysed drawing upon Alsup’s (2006) theory of borderland discourse. The findings of the study reveal pre-service teachers’ gaining new awareness about literacy and their discursive contradictions and tensions in the literacy teaching practices and in their critique (blame game) of: secondary school culture; perceived failure of the primary sector to teach literacy adequately; and the literacy teaching responsibilities of English teachers and other subject teachers in the secondary school system. Such findings have significant implications for teacher education.