Differentiated instruction is based on assessment and adapting activities to multiple levels and needs.
In teaching language arts, there are many things to consider. Children will have different ability levels, different language proficiency, and different interests.
There are three basic methods of differentiation. You can differentiate content, process, or product. When differentiating content, you teach different children different things. This is the most extreme form of differentiation, because usually the content will need to be the same. Teachers have content standards that they are expected to teach to.
Process and product are easy to differentiate in language arts. When differentiating process, you teach different groups of children different ways. The simplest way to do this is to group children and have some work with you at different times. Some groups will be more independent and be able to do more on their own, while others will require step by step help to get to the same end.
That end is the product. It is also easy to differentiate. You can have kids learn the same things in the same way, and show you what they know differently. Some kids may present the information orally, and others in an essay. Some may do independent enrichment projects while others complete worksheets.