This study examined transfer facilitation effect of first language morphological awareness on second language lexical inference ability among Grade 6 Chinese-speaking English as a foreign language learners in China. A set of paper and pencil tests was administered to measure children's morphological awareness and lexical inference ability in both Chinese and English. Results showed that the contribution of Chinese morphological awareness to English morphological awareness was larger for compound words than for derived words. In addition, the indirect effect of Chinese compound awareness on English compound word meaning inference was significant, but that of Chinese derivational awareness on English derived word meaning inference did not achieve significance. These findings confirmed that cross-linguistic transfer of Chinese morphological awareness was responsive to the linguistic distance between Chinese and English.