Preschoolers participated in a modified version of the disambiguation task, designed to test whether the pragmatic environment generated by a reliable or unreliable speaker affected how children interpreted novel labels. Two objects were visible to children, while a third was only visible to the speaker (a fact known by the child). Manipulating whether a novel object was visible to both interlocutors or hidden from the child tested the child's understanding of pragmatic expectations of interlocutor competence. When interacting with a speaker with a history of accurately labeling familiar objects, children responded appropriately in both cases. When interacting with a speaker who previously generated inaccurate labels for familiar objects, children's behavior and eye-movements reflected their belief that the speaker was not a competent communicator. These data support the hypothesis that children consider the pragmatic environment constructed by an interlocutor when that speaker asks them to make a lexical inference. (Contains 1 footnote.)