Competence in many domains rests on children developing conceptual and procedural knowledge, as well as procedural flexibility. However, research on the developmental relations between these different types of knowledge has yielded unclear results, in part because little attention has been paid to the validity of the measures or to the effects of prior knowledge on the relations. To overcome these problems, we modeled the three constructs in the domain of equation solving as latent factors and tested (a) whether the predictive relations between conceptual and procedural knowledge were bidirectional, (b) whether these interrelations were moderated by prior knowledge, and (c) how both constructs contributed to procedural flexibility. We analyzed data from 2 measurement points each from two samples (Ns = 228 and 304) of middle school students who differed in prior knowledge. Conceptual and procedural knowledge had stable bidirectional relations that were not moderated by prior knowledge. Both kinds of knowledge contributed independently to procedural flexibility. The results demonstrate how changes in complex knowledge structures contribute to competence development. (Contains 5 tables and 2 figures.)