We investigated the reading and spelling development of 140 Persian children attending Grades 1-4 in Iran. Persian has very consistent letter-sound correspondences, but it varies in transparency because 3 of its 6 vowel phonemes are not marked with letters. Persian also varies in spelling consistency because 6 phonemes have more than one orthographic representation. We tested whether lexicality effects--an advantage of words over nonwords--would be affected be reading transparency and spelling consistency. We found that children became more efficient readers and spellers across grades, with the greatest growth occurring between Grades 1 and 2. For reading, lexicality effects were present with transparent words starting in Grade 2, but lexicality effects with opaque words were not yet present in Grade 4. As expected, the size of transparency effects for reading decreased across grades. For spelling, however, there was no lexicality effect for either consistent or inconsistent words. Moreover, consistency effects were large and did not decrease systematically across grades. Most interesting from a developmental perspective was the finding that both reading transparency and spelling polygraphy affected reading as well as spelling in Grades 1 and 2, but the word characteristics had differential effects as a function of literacy task in Grades 3 and 4. This pattern highlights the vulnerability of children's representations and processes during the early phases of acquisition as well as the rapidity with which representations and processes become specialized as a function of the literacy task at hand. (Contains 6 tables.)