The essential first step for a beginning reader is to learn to match printed forms to phonological representations. For a new word, this is an effortful process where each grapheme must be translated individually (serial decoding). The role of phonological awareness in developing a decoding strategy is well known. We examined whether beginning readers recruit different skills depending on the nature of the words being read (familiar words vs. nonwords). Print knowledge, phoneme and rhyme awareness, rapid automatized naming (RAN), phonological short-term memory (STM), nonverbal reasoning, vocabulary, auditory skills, and visual attention were measured in 392 prereaders 4 and 5years of age. Word and nonword reading were measured 9months later. We used structural equation modeling to examine the skills–reading relationship and modeled correlations between our two reading outcomes and among all prereading skills. We found that a broad range of skills were associated with reading outcomes: early print knowledge, phonological STM, phoneme awareness and RAN. Whereas all of these skills were directly predictive of nonword reading, early print knowledge was the only direct predictor of word reading. Our findings suggest that beginning readers draw most heavily on their existing print knowledge to read familiar words.