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This study investigated the hypothesis that vocabulary influences word recognition skills indirectly through set for variability, the ability to determine the correct pronunciation of approximations to spoken English words. One hundred forty children participating in a 3-year longitudinal study were administered reading and reading-related measures at four time points. Hierarchical regression and path analyses indicated that vocabulary and phonemic awareness made independent contributions to variance in set for variability; that vocabulary directly influenced future reading comprehension and indirectly influenced future decoding and word recognition through set for variability; and that set for variability influenced future reading comprehension indirectly through both decoding and word recognition, controlling for autoregressive effects.