The aims of this study are to Investigate EFL Omani Grade Two Learners' Ability to produce the (43) sounds which are taught in grades one and two course books and to elicit the perceptions of grade two teachers about their learners' abilities to produce the phonics. It focuses on answering the following questions: 1. How do EFL Omani grade two learners produce phonics? 2. Are there any significant differences between grade two learners' ability to produce phonics in isolation, in taught words and in untaught words? 3. Are there any significant differences between grade two learners' ability to produce the consonants, the vowels and the consonant clusters? 4. How do EFL Omani grade two learners produce phonics as perceived by teachers of grade two? The study sample consisted of second grade learners and teachers in Al-Batinah North Governorate in the academic year 2010/2011. They were 100 learners and 27 teachers. Two types of instruments were used to answer the research questions. First, a reading test to measure learners' ability to produce phonics. Second, a questionnaire was used to elicit the perceptions of grade two teachers about their learners' abilities to produce the phonics. The Major findings of the present study were as follows: 1- Learners' performance in sounds represented by 'd', 'sw', 'v', '1', 'a', 'bl', 'cl', 'gl', 'h', 'b', 'x', 'sk' 'w', 'c','g', 'sl', 'ff', 'p', 'n', 'z', 'st', 'sn', 'o', 'e', 's', 'sp', 'fr', 'r', 'br', 'k', 'sm', 't', 'f and 'm' is at the acceptable level of performance. Learners' performance in sounds presented by 'q', 'u', 'y', 'i', 'sc', 'T, 'ss', 'j' and 'zz' is below the acceptable level of performance, 2- That there is a significant difference between grade two learners' ability to produce phonics in isolation and phonics in untaught words in favor of phonics in isolation. There is also a significant difference between grade two learners' ability to produce phonics in taught words and phonics in untaught words in favor phonics in taught words. Finally, there is a significant difference between grade two learners' ability to produce phonics in isolation and phonics in taught words in favor of phonics in isolation. 3- There is a significant difference between grade two learners' ability to produce the consonants and the vowels in favor of the consonants. There is also a significant difference between grade two learners' ability to produce the consonant clusters and the vowels in favor of the consonant clusters. However, there is no significant difference between grade two learners' ability to produce the consonants and the consonant clusters. 4- Learners' performance in all the tested sounds comes at moderate difficulty as perceived by teachers of grade two. In the light of these results, the researcher made a number of recommendations.