This contribution addresses the interface between grammar and discourse. It approaches grammar as a socially recognized procedure for coding, with a cognitive basis in individual language users. However, it emphasizes the need to distinguish the cognitive representation of grammar from the flow of discourse itself, which involves a more complex socio-cognitive process. Within this framework, grammatical structure is presented as a result of functional differentiation in communication, and grammatical slots emerge as basic functional-structural interface units between grammar and discourse. The layered structure of the clause that has been posited by Functional Grammar is then seen as forming the basis of this view of grammar as procedural knowledge, and emphasis is placed on the inevitable simultaneous functioning of all layers in grammar. The article finally turns to the relation between this view of grammar and the role of incrementality in the flow of discourse, with specific attention being paid to formulaic language and units of discourse.