The study analyzes the development of deaf children`s narrative competence in the Clinic for the Hearing Impaired of the Federal University of Rio de Janeiro. It aims at demonstrating how deaf children reveal narrative knowledge schemas in interaction with a speech therapist while telling and retelling the - Little Red Riding Hood - fairy tale. It further shows how the speech therapist can amplify such knowledge schemas while mediating the coconstruction of the narrative interactionally. To do it, the study takes a qualitative and interpretative approach, within the framework of Ethnographic microanalysis, linguistically examining transcribed face-to-face interactions and field notes. This theoretical framework articulates knowledge from Interactional Sociolinguistics, the Theory of Narratives, narrative development in childhood and mediation strategies. The analysis reveals that children show different narrative knowledge schemas while narrating. To accomplish the task, they required different degrees and types of mediation by the interlocutor, varying from greater to lower levels of dependency. Furthermore, the study reveals that the speech therapist draws on the following mediating strategies: elicitation and clarification questions, reformulations, and information-giving utterances. These strategies motivate and regulate the level of difficulty of the task in relation to the children`s ZPD. Consequently, they differed from child to child according to the schemas of knowledge each one demonstrated to have while telling and retelling the tale. The collaboration of the mediator allowed those in initial stages of narrative development to retell, achieving a better performance than they would have, had they done it autonomously. The results of this study have contributed to advance and reinforce reflexive practices in the Clinic for the Hear ing Impaired, enhancing the understanding of professional practices in the educational audiology.