Words’ morphemic structure and their orthographic representations vary across languages. How do bilingual experiences with structurally distinct languages influence children's morphological processes for word reading? Focusing on English literacy in monolinguals and bilinguals (N = 350, ages 5–9), we first revealed unique contributions of derivational (friend-li-est) and compound (girl-friend) morphology to early word reading. We then examined mechanisms of bilingual transfer in matched samples of Spanish–English and Chinese–English dual first language learners. Results revealed a principled cross-linguistic interaction between language group (Spanish vs. Chinese bilinguals) and type of morphological awareness. Specifically, bilinguals’ proficiency with the type of morphology that was less characteristic of their home language explained greater variance in their English literacy. These findings showcase the powerful effects of bilingualism on word reading processes in children who have similar reading proficiency but different language experiences, thereby advancing theoretical perspectives on literacy across diverse learners.