Two studies investigated the ability to use contextual information in stories to infer the meanings of novel vocabulary by 9-10-year-olds with good and poor reading comprehension. Across studies, children with poor reading comprehension were impaired when the processing demands of the task were greatest. In Study 2, working memory capacity was related to performance, but short-term memory span and memory for the literal content of the text were not. Children with poor reading comprehension were not impaired in learning novel vocabulary taught through direct instruction, but children with both weak reading comprehension and vocabulary were. Implications for the relation between vocabulary development and text comprehension are discussed.