The present study aimed at investigating the effect of a program based on literature circles on developing creative writing skills and motivation for writingof EFL student-teachers at Women's College, Ain Shams University. The study adopted the one-group research design and made use of two measurement tools; a pre-post creative writing test and a writing motivation scale. The creative writing program was designed in the light of literature circles principles and creative writing teaching techniques. The program was applied to a sample of 35 fourth year student-teachers of English at Women's College. The student-teachers participated in literature circles through reading some personal essays and short stories in groups, analyzing them and performing certain reflective tasks. Then they write their own personal essays and short stories. The results of the study have shown that the proposed literature circles program was effective in developing the participants' creative fiction writing skills, namely; plot, characterization, dialogue, setting and language style and non-fiction skills which are; narrative, organization, voice and language use. The program also proved to be effective in increasing writingmotivation of EFL prospective teachers.