A study of reader response to newspaper articles in a defamatory context tested: (1) the judicial assumption that the macro-environment in which statements appear is important to a reader's distinguishing between fact and opinion; (2) the possibility that a byline may influence a reader's characterization of statements; and (3) the idea that people react differently to opinion than to fact. Since American libel law protects statements of opinion and finds only fact statements defamatory, an understanding of how readers distinguish between opinion and fact is crucial to attorneys, judges, journalists and publishers. Subjects, 57 Stanford University (California) students, read a mock newspaper in which two articles appeared on a news page and two were on an editorial page, and were asked to rate the articles as to their opinion or fact nature and to assess the person being defamed by the articles. Findings indicated that the macro-context strongly influences reader perception, so that an article appearing on the editorial page is more likely to be considered opinion than when that same article appears on the news page. The presence or absence of a byline was not found to influence the fact/opinion distinction. Surprisingly, statements perceived to be opinions were more influential in assessing the defamed person's reputation than statements perceived as facts. (Four pages of endnotes and three tables of data are attached.) (MHC)