In this study, 2.5-, 3-, and 4-year-olds (N=108) participated in a novel noun generalization task in which background context was manipulated. During the learning phase of each trial, children were presented with exemplars in one or multiple background contexts. At the test, children were asked to generalize to a novel exemplar in either the same or a different context. The 2.5-year-olds' performance was supported by matching contexts; otherwise, children in this age group demonstrated context dependent generalization. The 3-year-olds' performance was also supported by matching contexts; however, children in this age group were aided by training in multiple contexts as well. Finally, the 4-year-olds demonstrated high performance in all conditions. The results are discussed in terms of the relationship between word learning and memory processes; both general memory development and memory developments specific to word learning (e.g., retention of linguistic labels) are likely to support word learning and generalization. (Contains 2 figures.)