When hearing a novel name, children tend to select a novel object rather than a familiar one, a bias known as disambiguation. Using online processing measures with 18-, 24-, and 30-month-olds, we investigate how the development of this bias relates to word learning. Children's proportion of looking time to a novel object after hearing a novel name related to their success in retention of the novel word, and also to their vocabulary size. However, skill in disambiguation and retention of novel words developed gradually: 18-month-olds did not show a reliable preference for the novel object after labeling; 24-month-olds reliably looked at a novel object on Disambiguation trials but showed no evidence of retention; and 30-month-olds succeeded on Disambiguation trials and showed only fragile evidence of retention. We conclude that the ability to find the referent of a novel word in ambiguous contexts is a skill that improves from 18 to 30 months of age. Word learning is characterized as an incremental process that is related to--but not dependent on--the emergence of disambiguation biases. (Contains 1 table and 6 figures.)