Reading binary formatted data

Hello,
    I have a question dealing with reading binary formatted data.  I am 
trying to interface with a legacy software system and its just not 
feasible to upgrade the whole system in one night.  Suppose that the 
data comes in two bytes, is it possible to define a the value of the 
bits and place it in a tag from just two bits?  The data that XML has to 
read  is strictly structured and I would like to write my schema off of 
that.  Any help would be appreciated.