A covariance structure modeling perspective on reliability estimation can be used to construct a formal approach to estimation of reliability in multilevel models. This article presents a didactic discussion of the relation between a structural modeling procedure for scale reliability estimation and the notion of reliability of observed means in unconditional multilevel models. The utility of the method is demonstrated as an alternative means for conceptualizing multilevel modeling reliability. The relationship between the underlying two reliability notions is illustrated on a set of hierarchical data.