Down syndrome is associated with severe deficits in language and verbal short-term memory, but the causal relationship between these deficits is unclear. The current study therefore investigated the influence of language abilities on verbal short-term memory performance in Down syndrome. Twenty-one individuals with Down syndrome and 29 younger typically developing children were tested on memory for words and nonwords using 2 immediate recognition tasks: an order memory task that was a relatively pure measure of verbal short-term memory and an item memory task that was more sensitive to language ability. Despite having superior vocabulary knowledge to the typically developing children, individuals with Down syndrome were impaired on both order and item tasks. This impairment was particularly marked on the item task, where individuals with Down syndrome showed an atypically large lexicality effect. These results are interpreted in terms of an underlying verbal short-term memory deficit in Down syndrome that is compounded by poor phonological discrimination abilities.