The goal was to assess the role of invented spelling to subsequent reading and spelling as proposed by the Nested Skills Model of Early Literacy Acquisition. 107 English-speaking children were tested at the beginning of kindergarten and grade 1, and at the end of grade 1. The findings provided support for the proposed model. First, the role played by phoneme awareness and letter knowledge to early reading was mediated, at least in part, by the sophistication of their invented spelling. Second, all children who spelled words accurately at the beginning of grade 1 could read words, but not all children who could read spelled accurately. Third, word reading, and, to a smaller extent, invented spelling in kindergarten predicted unique variance in spelling accuracy in grade 1. Fourth, invented spelling (not accurate spelling) predicted growth in word reading during the first year of reading instruction. Implications for education are discussed.