The Philippines, a treasury of oral folk epics, gives us opportunities to research epics in transition, which implies documenting and introducing them to wider audiences. The losing of living epic tradition attracts national and international attention and becomes a concern of the state and the educational system. This study is focused on the literary characteristics Ricaredo Demetillo’s Barter in Panay: An Epic in which his materials were gathered from Maragtas, a semi-legendary recordof the Bornean settlement in Panay. The study is (...) anchored to Hornedo’s theory of reality frames in teaching literature. It unfolds the literary characteristics of the text through descriptive-qualitative method employing formalistic-contextualist approach. The study reveals the theme/s through the narration of the persona, the Filipino worldviews in contemporary times though the language of the characters. Barter in Panay: An Epic reflects the “sweetness and light” of the Filipino lifeways and traditional values. Demetillo’s literary epic is vehicle of preserving our folkloric tradition depicting our Filipino identity and worldview, making the text significant in the canon of Philippine and World literatures. The author emphasizes the urgency to know our past and to revise our understanding of the world within the progress of time. Keywords - Folk literature, barter in Panay, formalistic-contextualist approach, reality frames in teaching literature, literary epic, Central Panay, Philippines. (shrink)