The theoretical generalization and the solving of an important and urgent problem, that is provided to identify and disclosure organizational and pedagogical foundations of literacy in Ukraine in 1920-1927, are presented in the investigation. Normative and jurisdictional regulatory means of literacy establishments functioning in Ukraine in the context of studied period are analysed, such as: laws and regulations of the Central Committee of Party's Providing Committee (b), Central Committee of Communist Party (b) of Ukraine and the Government of the USSR and the Ukrainian SSR, which highlighted the work of the government on the development of education and poverty illiteracy. The author distinguished four stages of literacy foundation development in Ukraine in 1920-1927 years: 1st - initial phase (1919 - mid 1921) which characterized by the beginning of illiteracy liquidation in Ukraine adopted by the Council of People's Commissars of the first document to regulate the process of literacy foundation, and is indicted by The Decree "On the Procedure of illiteracy liquidation among RSFSR's inhibiters" and others. Library workers' clubs, school of illiteracy liquidation, national universities and similar educational institutions were established to provide the Decree. 2nd - stage is the stage of temporary curtailment of literacy in Ukraine (second half 1921 - first half 1923). The reasons for this phenomenon were as follows: the transition from the state of literacy in local money supply, which estimates often barely taken due to lack of funds; mood of the organizations responsible for the illiteracy liquidation; staff downsizing, political education etc. However, in Ukraine, in most of provinces the general folding of the illiteracy liquidation the educational process continued, though not so intensive as before. 3rd - a crucial stage of literacy foundation (1923 - second half of 1924). - Developed a clear legal framework literacy, specific plans for its liquidation among the various segments of the population; was public opinion on the need for literacy classes were created Aid Society literacy; sources of financing. 4 - step out of the crisis in the struggle against illiteracy (1925-1926.). The period when the development of the economy and some strengthening of central and local government to a certain extent strengthened and revived the case of public education. When ensuring minimal material basis, the central and local literacy development. The study defines the principles, objectives, contents, forms and methods of educational institutions to eliminate illiteracy. It is proved that the basic principles that guided in eliminating illiteracy, were: humanism, nature appropriate, individualization, differentiation, democracy, communication, training and education with life, consciousness, activity, independence, accessibility, visibility, nationality and others. The content of the studied process was to realize the following objectives: to disseminate knowledge and increase educational and cultural level of the population, education and mental development of children and adults, moral education and development of students, socialization of children and adults. Organizational forms are determined (school and after-school, individual, group and collective educational activities educational program); revealed a system of methodical work establishments literacy (introducing advanced teaching experience, creating a creative atmosphere in the team, a combination of different forms of theoretical and practical education and self-education, conducting surveys, statistical and narrative reporting). The investigation proved out that he process of literacy in Ukraine in 1920-1927 years as a separate social-pedagogical phenomenon had a significant influence in shaping the educational potential of the Ukrainian nation, characterized by specific implementation was due to socio-political, economic and socio-cultural factors.