Although research has consistently shown that a bilingual's two languages interact on multiple levels, it is also well-established that bilinguals can vary considerably in their proficiency in the second language (L2). In this paper we review empirical studies that have examined how differences in L2 proficiency modulate cross-language co-activation and interaction during bilingual lexical processing. We review studies investigating cognate and homograph processing in visual word perception and word production, auditory word perception using the visual world paradigm, and cross-language priming, focusing specifically on how differences in proficiency modulate co-activation during lexical access. We further discuss differences in L2 proficiency in relation to immersion and age of L2 acquisition, how differences in L2 proficiency relate to neurocognitive aspects of cognitive control, and how changes in L2 proficiency relative to L1 proficiency may affect lexical processing. (Contains 2 notes.)