This study examined the structural relationships between (a) the latent independent constructs of orthographic and lexical knowledge and phonological sensitivity and (b) the effect of these constructs on the latent construct of literacy manifested by reading aloud and spelling regular and exception English words in 156 Cantonese-speaking Chinese students (M age = 10.8 years) who were learning English as a second language in Hong Kong. Three carefully designed and item-analyzed indicators subserved the construct of orthographic and lexical knowledge, and another three indicators subserved the construct of phonological sensitivity. Our hypothesis of greater contribution of word-specific orthographic and lexical knowledge than phonological sensitivity to learning to read and spell English words in these Chinese children was supported by results from multiple regression, principal component analyses and especially by structural equation modeling. The various goodness-of-fit dexes showed the appropriateness of the indicators in measuring the latent constructs as well as the relationships among these constructs.